Carel A. “Chad” Prater of Sarasota was found guilty of a vareity of government fraud-related charges, including corrupt interference with the federal tax laws, aiding and assisting the filing of a false tax return, failure to file a tax return, criminal contempt, structuring transactions to avoid reporting requirements and making false declarations before a grand jury this week.

Prater served as his own attorney during his trial, which is certainly allowed but never advised due to the nuances of criminal and constitutional law as well as the detailed rules which govern trial procedure.

In his own defense, he claimed that income earned in the United States is generally not taxable. According to law enforcement, Prater perpetrated a scheme by which he purported to help his clients “legally” avoid paying income taxes. He claimed he could legally remove his clients from the federal tax system.

He also advised clients to conceal assets and income from the IRS through shell LLCs and other corporate entities.

Prater charged fees to prepare false tax returns and falsified documents that were submitted to the Internal Revenue Service on behalf of his clients. Between 2000 and 2003, Prater’s gross receipts for these services exceeded $2 million, according to prosecutors.

Prater’s sentencing is scheduled for May 24. He faces up to 33 years in federal prison. He has several prior felony convictions for insurance fraud, theft and cocaine possession, dating back to 1983.

In 2005, Prater, among others, sued the IRS, alleging its collection of taxes was illegal. That lawsuit was dismissed by a federal district court judge who stated that the suit lacked any basis in the law.

Government Fraud, White Collar Crimes

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