Evening star., 1952-09-17
Lack ckofEvidencein' '33
Baked Erickson Case,
Revenue Bureau Says

Internal Revenue Bureau rec
|ords showed today that officials
in 1888 believed they lacked
enough evidence to convict Frank
A. Erickson of income tax fraud
and let him pay about 5000 in
lieu of criminal liability.
The payment came to light
when the bureau made the tax
settlement record available for
public inspection. Such inspection
|of tax claim compromises recently
was authorized by the bureau on
request in specific cases.
Since July. 1884, seven months
after bookie boss Erickson paid a
settlement of tax claims against
him for 1928, 1929 and 1880, the
bureau has followed a policy Of not
accepting cash payments to COM
promise possible criminal prosecu-
tion, it explained.
Two Compromise Settlements.
In two separate compromise
settlements covering the years
1925 through 1888. Erickson paid a
total Of $211.901 on tax claims
that totaled $314,915.
The breakdown on this was as
follows: In 1887 he paid $144,40
on claims amounting to $3.50, ,4O5
for 1926, 1927, 1881, 1892 and 1888.
The $3.50. .405 figure was made up
of $136,180 which bureau agents
declared Erickson should have
paid additionally in income tax
for those years; $56.134 in ac-
Icrued interest, and about $68. 900
in penalty. There was no crimi-
nal liability compromise payment.
In 1888 Erickson, now under
indictment for contempt In refus-
ing to answer questions of the
kefauver crime investigating
committee. paid a compromise
settlement of $67.500. This took
i'm the $36,340 which the bureau
said he owed In income tax for
1928. 1929 and 1880.
It also included $18.170 in civil
penalties and some $4,000 in ac-
Icrued interest. The remainder of
the SCI, 500, bureau officials ex-
|plained. was the more than So
900 which Erickson was allowed
to pay in lieu Of criminal liability.
Bureau agents, according to the
investigation record and official
statements to the Treasury De-
partment at the time, contended
that Erickson had understated his
income for the respective years
But the bureau, according to a
1887 statement and official COM
ment today. agreed to accept the
criminal liability compromise pay
ment solely on the ground that
Erickson probably could not have
been indicted and convicted on the
basis of evidence at hand.
"The facts available are not be-
lieved sufficient to warrant re-
ferring the case to the Department
of Justice with q recommendation
for criminal prosecution" the re-
port stated.
The statement was signed by
Morrison Shafroth, then CHIEF
counsel Of the bureau.
Bureau spokesmen said today
that such compromises in lier
of criminal prosecution were ir
accordance with an internal reve.
niue code provision permitting thu
commissioner to accept such offer.
If approved by the Secretary Of the
Treasury.
/ Officials cited several instance.
prior to 1884 in which cash pay.
nents were accepted in cases where
the bureau doubted it could Obtain
a conviction, or where the cost ol
litigation would be unusually high
Ior under other special circum.
stances where prosecution was in.
advisable or impractical.
Stopped Compromise Payments.
| A policy regulation announced
in July. 1884, stopped the takini
of compromise payments in lieu
of criminal liability. Bureau Of.
ficials said present policy is tt
/, recommend or not recommend
criminal prosecution solely or
the basis Of whether the evidence
in particular case is sufficient
to indicate guilt beyond a reason
able doubt and that there is 9
reasonable probability that con-
viction can be secured"
/ Since that time the bureau has
automatically rejected" any Of
fers Of such compromise. they