this is an unusual tax evasion case there are really two issues that i came to talk to you about today there are other things that the court must talk about of course i'll go with those but the main two issues i want to talk about is the sufficien based on three affirmative acts according to the end i mean it was that daniel's request to pay must direct me from his office manager the dalles maintain false business records and that daniels provided false business records to a c take these in reverse order because really the government's case is built on a somewhat shaky foundation that's why we don't think the evidence was sufficient if you look at what daniels provided to his c p a he provided his quick books computer program and how he input information into his quick books program is that he took his checking account statements or his bank statements from central tokyo wellness center and input information into quick books good books in generates what's called the trial balance profit and loss and general ledger statements and what sarge what specialism vote to a trial if daniels did this and the bank accounts were correct then the government wouldn't have a problem with what he did as far as turning those documents over to a a that's ok if daniels knew that the checking account statements were incorrect that's where the problem comes and that would be an affirmative act if he didn't know that that can't be an affirmative well again if daniels didn't have knowledge that money was being taken out of that cash box you hear some of the basic struggle ok that argument let's say he didn't know whitman was taking money out specifically let's just assume your your position he does know that some money comes out because he's asked his employees to keep up a log of that and then he now who's more money is being deposited into his personal account hell can he not having gauged in an affirmative act when business money that should have gone into the business account shows up in his personal account does he just you know i don't understand how he has he doesn't know that he's getting the money when he thinks he's put x dollars in he's a k out and when he opens it up he's got a whole lot more the way i would answer that is the government didn't present any evidence of his other bank accounts there they presented evidence from whitman that she put money into his account in don't they don't have to show you his account by have her testimony so we know that extra money went into his account actually we know the dollar value of it on the yearly basis so so how do you explain his not questioning what forty seven thousand dollars that showed up in his personal account instead of his business account i guess is the way i would answer that is didn't mr vance had other businesses and the money from other businesses or the money that whitman was giving him he never i don't guess he ever questioned where that money came from he didn't understand it if he was running other businesses that would widen involved and he would know what he put in his personal correct all right so how does he account for the money that whitman puts that she was taking money to give to him or putting it in his business account or putting it in his checking account as she was handling a small camp i mean that was her testimony he got unhappy because he bounced a check or something over the weekend so bob reserved money and i put it in his account on friday and you know you may not like that but i think that i think that works against your sufficiency of the evidence argument because of th what she testified to is that she gave him cash or put money in one of his accounts he didn't necessarily know where that money came from it was money that she i guess my problems were on the sufficiency of the evidence standard the you get to draw reasonable inferences from circumstantial evidence she testified i didn't put money into the business account because he was overdrawn in his personal camp began to put it in his personal account i don't know how a reasonable juror could not consider  the deposit of money that did not go into his account that he must have known i mean if he's overdrawn one week and he's got a whole lot of money the next the practical reality is somebody put  thought on that would be she was putting in an incremental amount she wasn't putting in whole forty thousand dollars i mean eventually all over town over time it went up that much but it does the significance of the male control this pander to review or does the fact that he was getting regular additions to his k k out from his business not running through his business doesn't that just carry the day against  sufficiency of the evidence argument i'll guess my response would be that daniels that know if she was taking money from hit the biz account and putting it in his checking account or if she was take me rephrase that daniels didn't were sufficiently small that would have been enough to put him on inquiry mode but that's a point i'm trying to make here is he wouldn't know to inquire about that at forty seven thousand dollars while if that went into my  about being in overdrawn so he's got to know pretty closely what's kept in his account if he's overdrawn and she then deposits it so he won't be overdrawn again what reasonable drew or could not account that's what i'm saying is that i think the standard doesn't yes could a reasonable juror agree i think the standard is that you have to exclude that evidence in order to get to the sufficiency of the evidence problem yes i agree and i think what the situation is here is that the government never specifically asked when did you did you inform daniels that you were taking money out of his cash box and putting it in these accounts that was talked about and suggested but it was never specifically asked the closest they got was so they never asked the question well did he know that you were taking money out of the cash box and giving it to him why did he have them to keep a log and record what they were moved from a cash box didn't know money was coming out of the cash box well i guess at some point there's no testimony on this but at some point what what could have happened is he could have seen that there was some money not in the cash box it should have been and he want to know about that i know where you criminal we admitted daniels failed to fail to follow his taxes but there was never any proof or funding by the court that this was a criminal act this will fulfill you to fall as a criminal act the court only found he didn't follow his taxes so you can't use the whole number of the forty seven thousand dollar number the only part you can use is what was in miss winds notebook not thousand dollars and that reduces said the grand jury was he told her to give her cash in both cases but the jury saw was that he knew mr dinos knew that this money was being taken out of the cash box and that it was being given to him and the amounts were certainly significant as began a five hundred hours a week it went up to fifteen hundred dollars a week i would bet its peak that's a significant amount of money mr daniels looking at his total taxes this is a significant chunk of money this is not money that could be mis could be misplaced and the jury saw this and the jury properly determined and it was reasonable for them to conclude that he knew that this was going on and that the reason it was books so nobody else could put those entries into the books only he could and he did not fulfill its responsibility of making sure that all of the amounts that were that his business took in made it into books account as his when testified at trial he knew that that was going on he knew that these numbers were not going into the business bank accounts and therefore not going on his quick books and he never attempted to reconcile those numbers with the quick book numbers that he was giving to the c p a on the sensing issue and the key point is that regardless of which sensing guidelines that is used and the district court file in this case and that itself is a criminal act and we don't the knowledge of the tax laws is in tent party is meant for the affirmative act so certainly if the of tolbert october fifteenth when the extension expires so there was a the indictment did not match the actual dates of the conduct that was the problem so we dismissed that charge based on that technical reason based on a problem with the indictment but we could have proven that charge at trial and all the evidence the jury had for it was enough to convict him on the failure to file charges as well but even if even if we could not hopefully thank you for your honour's i'll touch on more on the you know the the guidelines issue the government in this case wants to have its cake and eat it too they want to dismiss the willful failure to follow charge and yet come around and have it play a part in a sentence that's not fair didn't have evidence to prove it but failure to fall by itself is not a prom it has to be a willful failure to file and the government never prove that but even if we agree with you that it's not fair it is cases cited by the government united states versus me can united states versus justice for there the defendants conceded that their failure to fall was criminal in nature here we've never conceded that we've never said yes his failure to fall is criminal we can test of that all the way and like i said if i've just read the district court's sentencing transcript two days ago nowhere in that sense in transcript as you say i found that mr daniels is guilty of willful fail follow that was a criminal act he said he failed to follow therefore i'm including it but you've got to have that criminal component before you can use that in sentencing but the guidelines and the application notes seem to contemplate that if there is a sort of the same course of conduct relevant conduct then it can be taken into account for purposes of sentencing so that  mushy how you get around that but argue that in united states versus daniel i don't think there's any relation there but in the united states versus daniel the court held that there must be evidence of criminal behavior regarding the total tax liability that the tax loss must be a criminal deficiency it's not civil liability so there must be some type of finding that this is criminal this what he did was illegal there was no proof a trial they proved they didn't follow us taxes we admit that but they never proved his failure to file taxes was criminal the jury well the i know you argue the spies are species evil motive legal duty to file your taxes so if the evidence showed that he was voluntary early and intentionally did not file doesn't that satisfy the standard of if you're not in on it was intentional but the word i'm looking for is if you're negligent in failing to file taxes if there's some excuse in failing to file taxes if it's based on the advice of counsel or some other reason th the potentially could not be found guilty for willful failure to file taxes ok but we thank you for your arguments this morning thank you the case will be submitted