It was a dark and stormy night in Cicero

July 31st, 2012 by Joe Kristan

Of the many bad consequences to tax fraud, the way it keeps the statute of limitations for assessment of tax open forever is definitely one of them.  A convicted former Mayor of Cicero, Illinois, Betty Loren-Maltese, learned about that the hard way yesterday in Tax Court.  

Her pain probably wasn’t eased by the delighful opinion written by Judge Mark Holmes.  You should read the whole thing, starting with its great explanation of how the tax law determines when there is fraud when a taxpayer invokes the Fifth Amendment (all emphasis mine):

We can also draw inferences from her silence if, under the circumstances, it would’ve been natural for her to object. See United States v. Hale, 422 U.S. 171, 176 (1975). This later principle is not constitutional, just an acknowledgment of human nature. The original Cicero made the point 2,000 years ago in his oration exposing the plot of Lucius Catilina and his friends to plunder their government’s treasury. He observed that people have a natural tendency to defend their reputation, and that silence in the face of accusations suggests that there might be some merit to the charges. The Latin is more succinct: Cum tacent, clamant.

The background is also full of fun:

The silence that shouts out here arose from Cicero, Illinois, a suburb of Chicago that sits on its western hip like a well-holstered gun, and that has a colorful history that reaches back into the 1920s when Al Capone took refuge there. (Capone, though best known for his failure to file accurate tax returns, was also apparently well known for superintending a large number of saloons and other illegal enterprises in Cicero during Prohibition.) Some of this past is not dead, and is not even past — as Ms. Loren-Maltese remarked at trial: “There’s always investigations in Cicero.”


Her tenure in office was not tranquil. In October 1996 the Chicago Sun-Times ran an article that named her as a target of a government investigation. In June 2001 a federal grand jury indicted her and several coconspirators for conspiracy to defraud the Town through a pattern of racketeering via multiple acts of bribery, money laundering, mail and wire fraud, official misconduct, and interstate transportation of stolen property. Her criminal trial lasted about three months, culminating in a conviction on August 23, 2002, on all but one count of the indictment (the criminal tax charge later tried separately). This put an end to her political career, and she was sentenced to eight years in prison.

A not-unusual Illinois political career trajectory.

Ms. Loren-Maltese, whose coiffure is legendary in Chicagoland, broke her Fifth Amendment silence on this subject only once — to tell us that though the car was a convertible, she didn’t go “cruising around” Town with the top down because she “wouldn’t want to mess up [her] hair.” On this narrow issue, we find her entirely credible, but the evidence that her use of the Cadillac was personal rather than political is overwhelming.

What is it with corrupt Illinois politicians and hair?

Cite: Loren-Maltese, T.C. Memo. 2012-214



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