Sep 22, 2002
The Associated Press
1/29/03 6:14 PM
ST. PAUL (AP) -- A tax-cheating probe now includes 42 Northwest Airlines employees, and investigators have said that some pilots may have conspired to avoid paying Minnesota income tax, the St. Paul Pioneer Press reported Wednesday.
The paper cited state Revenue Department and Hennepin County officials as saying the probe has been expanded.
The case previously involved seven Northwest pilots who were charged with tax evasion. They were accused of collectively owing $321,000 in unfiled taxes since 1996. Two have been convicted.
The 42 people under investigation include the original seven pilots who were charged. It also includes six new criminal probes, and 29 which are being pursued as civil cases.
The criminal cases all involve pilots. Most of the civil cases involve pilots, too, although other Northwest employees are also included, the newspaper reported. Prosecutors face less of a hurdle in bringing the civil cases, since they don''t have to prove the willful intent necessary to win criminal convictions.
Authorities also have been looking for evidence of a conspiracy among pilots. A search warrant in the case of pilot Randall Enyeart of Excelsior, whose trial begins Monday in Hennepin County District Court, suggests pilots may have worked together.
According to the warrant, Enyeart''s now-deceased brother told the state''s Criminal Investigation Division that Enyeart was willfully evading Minnesota taxes by claiming to be a resident of Alaska, which has is no state income tax.
He (Enyeart''s brother) stated that several NWA pilots were sharing an address in Anchorage, Alaska, as their residence while retaining permanent residences in other locations, the warrant says.
Enyeart''s attorney, Bob Sicoli of Minneapolis, said it''s wrong to assume the warrant suggests that pilots cooperated with each other to evade taxes. He noted the warrant cannot be used as evidence, and said Enyeart is innocent.
Hennepin County prosecutors are handling the criminal cases for the state. In addition to the first two pilots who were convicted, and Enyeart, four others face trial dates over the next three months. Six others are under investigation, and may soon face criminal charges, said Hennepin County Attorney Amy Klobuchar.
Last October, in the first pilot case, Dakota County Judge Karen Asphaug found Geoffrey Hickman of Mendota Heights guilty on five counts of tax evasion. The judge reduced the charges to a misdemeanor and sentenced Hickman to 150 days in jail. That ruling is under appeal.
Last month, a Washington County jury found pilot Rodney Mattmiller of Hastings guilty on seven tax-related charges. He will be sentenced March 20. Northwest fired both pilots after they were convicted.
A Northwest spokesman declined comment on the cases and ongoing investigations.
The pilot cases are part of a larger effort at the Department of Revenue to identify non-filers, said Dennis Erno, deputy state tax commissioner. Revenue officials said they have identified more than 70,000 non-filers for the 1996 to 1999 tax years. They said the state has collected $16.2 million out of $74 million owed.
For instance, investigators recently turned up seven Minnesotans, not Northwest employees, who listed their address as a single mail drop in Texas, another state that doesn''t have an income tax. That investigation, in its initial stages, also may lead to criminal charges, said Jerry McClure, director of collection enterprise for the Revenue Department.