Joe Francis – Tax Evasion Problems
Joe Francis is the owner of the company responsible for the Girls Gone Wild adult videos. He’s made a ton of money and tax evasion claims are one of his many problems.
The story of Joe Francis is an interesting one. A child with disciplinary problems, he somehow managed to get into USC. He graduated from the esteemed university – they must be proud! He then used an infomercial to sell a video of graphic car accidents. He next stumbled on to the concept of a video of girls flashing at Mardi Gras and other events. Francis formed Mantra Films, Inc., which started selling the Girls Gone Wild videos. Revenues are now reported to be in excess of $100 million a year.
The world of porn is one, which the federal government has all kinds of problems dealing with. The common trial involves claims of “obscenity”, but even the Supreme Court has had difficulty defining where the line should be drawn. This has resulted in a dearth of convictions and led to a different approach. As with the mob, a host of convictions have been obtained on the claim of tax evasion.
With Joe Francis, the situation is no different. On April 11, 2007, he was indicted in federal court on two counts of tax evasion. The specific claim is he signed corporate tax returns that were fraudulently false. Specifically, it is claimed that he claimed $20 million in false deductions on the 2002 and 2003 corporate returns for Mantra. After a number of delays, the latest trial date has been set for March 31, 2009.
The really interesting element of the case has to do with how the government came to understand there was a problem. The IRS didn’t discover anything. Instead, it was notified of an issue. Specifically, the accountant that prepared the return left the employment of Francis and then squealed on him in hope a reward would be coming! I am not a fan of pornographers, but this accountant is one heck of a rat. Apparently, the accountant was the one who prepared the return!
Will Francis be convicted of tax evasion? The jury will tell us once the matter goes to trial although one has to think a settlement might be in the offering.