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Casino Workers Sentenced for Tax Fraud

"The federal government said the stiff sentences showed that those who defraud the IRS out of tax income generated from tip revenues will be pursued.

"…But a defense attorney for one of the four criticized the prosecution of the employees of the Virgin River Hotel & Casino and said the prosecution lacked compassion.

"…At issue is what is known as a tip compliance agreement between the IRS and the gaming industry. Under the agreement, taxes are paid on what the government calls a reasonable estimate of the expected hourly tip income of an employee.

"Authorities alleged [Virgin River comptroller Dale] Seipp and dealers Belinda Mosdell, Leveda Taylor and Leo Shan How each conspired to provide false information to the IRS regarding the estimated hourly tip rate at the Virgin River.

"The federal government said that between July 1992 and July 1995, the four created and submitted fabricated tip records to the IRS. The government said that the records submitted listed their tip rate at $5.50 an hour and that the figure was calculated to allow the defendants to avoid their true tax liability.

"Prosecutors said the true hourly tip rate from 1994 to 1995 was between $7.05 and $10.46 per hour.

"…During a court hearing Monday, the four defendants appeared before U.S. District Judge Larry Hicks for sentencing.

"…Hicks said he had the option to not accept the terms of the plea agreement. But he chose to accept the agreement and said each of the defendants could have been sentenced to several years in prison if prosecutors did not tender the agreement.

"…With sentencing the four to jail, Hicks ordered restitution from each. The amounts ranged from $1,148 to $1,532…"

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