LEXINGTON — Defendants Rita Tipton and Gloria Williams sat emotionless in a federal courtroom Thursday as guilty verdicts were read on each count against them of conspiracy to commit bingo fraud, tax evasion and mail fraud.
Following a little more than two hours of deliberation, the jury returned guilty verdicts on one count of conspiracy, two counts of mail fraud and three counts of tax evasion against both women.
The defendants, both of Waco, will be sentenced Dec. 6 at 10 a.m. in U.S. District Court in Lexington. Until sentencing, the defendants were released on the same bond held before trial.
Assistant U.S. Attorney Ken Taylor asked that a condition be added to the bond barring them from bingo activities. Defense counsel Michael Dean asked if this meant the defendants were barred from the Jackpot Charity Bingo building in Waco as well, which is still owned by Tipton’s son. U.S. District Judge Jennifer Coffman told the defendants they are not allowed to be on the premises or participate directly or indirectly in any bingo activities.
“They’re not going to go,” Coffman said. “Things need to change right now.”
Count one of the indictment delineates the conspiracy, background of the scheme and overt acts by the defendants to use Jackpot Charity Bingo to create income for personal gain. That income, which was reportedly hidden from the federal government, was unclaimed on the defendants’ tax returns for the years 1999-2001.
Counts five through 10 divided by year the taxable income earned by the defendants and assessed taxes owed. Individually, the prosecution held Tipton responsible for $159,713.70 of unreported income, on which she reportedly owes $32,546 in taxes to the IRS. Williams reportedly owes $48,865 on $185,228 she did not report to the IRS on her tax returns.
For the years 1999-2001, Williams claimed no income and paid no taxes. Tipton paid no taxes and claimed no income in 1999 and 2000, but paid $138 in taxes in 2001, claiming $1,377 in income.
Counts 12 and 13 charged the defendants with mail fraud for using the United States mail as a way to further their scheme to defraud the government. False reports reportedly were mailed to the Kentucky Office of Charitable Gaming.
Taylor said he expected the guilty verdict.
“I thought the case went in really well,” he said.
Although Taylor said he thought the case came together through a combination of several strong pieces of evidence, the most telling was the purchase of illegal pull-tab games on four separate occasions by undercover officers with the OCG.
“That went totally unexplained,” Taylor said. “It’s hard to get around that.”
It is too early to tell what sentence Williams and Tipton will face, Taylor said. He did confirm, however, that the federal sentencing guidelines call for time to be served in prison. According to the indictment, the defendants will face not more than five years imprisonment on each charge in counts one through 10, not more than a $250,000 fine and not more than three years supervised release. A mandatory special assessment of $100 per count is applied with applicable restitution.
The penalty for mail fraud in counts 12 and 13 is not more than 20 years on each count and not more than a $250,000 fine.
Attorney Bill Yesowitch, who represents co-defendants Brenda and Cletis Adams, who pleaded guilty prior to the trial, said the sentences will be determined based on a sentencing table which evaluates the offense level and criminal history. Yesowitch said the offense level will be determined by the figures presented in the case.
Yesowitch said he plans to seek probation for the Adamses, who will be sentenced the same day with Tipton and Williams. The figures in the indictment claiming the Adamses owed $23,758 in taxes are inaccurate, Yesowitch said, because their losses were inaccurately determined through casino information from an outdated calculating system.
In the plea agreement, the government claimed the Adamses did not pay taxes on money they were skimming from bingo. The Adamses deny the money came from bingo skimming, but contended there were gambling winnings to explain any extra income.
“When I saw the evidence against (Tipton and Williams), we couldn’t afford to sit next to them,” Yesowitch said of his clients.
The prosecution began its case Sept. 11 and presented more than 40 witnesses. Family members, bingo players, OCG investigators, casino operators and IRS investigators testified throughout the eight-day trial. On Tuesday, the defendants took the stand in their own defense after several friends and relatives testified they had no knowledge of any illegal activities at the bingo hall.
Dean did not return phone calls Thursday seeking comment about his clients’ convictions.
Kelly Foreman can be reached at kforeman@richmondregister.com or 624-6694.
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