Ex-Brownsburg attorney gets 30-month sentence for tax evasion

A former Brownsburg attorney who pleaded guilty to tax evasion earlier this year will spend 2½ years in prison and owes more than $2.4 million to the Internal Revenue Service.

Scott C. Cole, 55, was sentenced to 30 months in prison by Chief Judge Jane Magnus-Stinson of the U.S. District Court for the Southern District of Indiana, U.S. Attorney Josh J. Minkler announced Thursday. Cole had no credibility before the court, the district judge said during Cole’s sentencing hearing, while noting he has “a complete lack of respect for the law, for the tax code, his fellow citizens and for the court.”

“Cole, a former attorney and paid tax preparer, intentionally and purposely used his ‘expertise’ to repeatedly obstruct the Internal Revenue Service and to evade his federal tax obligations,” Minkler said in a statement. “Taxpayers who deceive and defraud the federal government by deliberately failing to pay their federal income taxes, like Cole, will be found and prosecuted.”

Cole owes $2,410,443 to the IRS for his attempts to evade and defeat tax payments by opening bank accounts with sham company names and directing payment for services he rendered to the same artificial companies, Minkler’s office said. Additionally, Cole paid personal expenses through third-party business accounts, dealt extensively in cash and filed false 1040 tax returns understating taxable income.

Cole’s trouble began when Cole and his wife fraudulently withheld their 2001 income from the Internal Revenue Service through an elaborate shell game. The couple was found to have omitted more than $1.2 million of income from Cole’s legal work and more than $1.3 million of self-employment income from their 2001 joint tax return. The 7^th Circuit Court of Appeals upheld Cole’s conviction in 2011.

In April, Cole pleaded guilty to trying to evade payment of his taxes after a federal indictment charged him with failing to report more than $1.5 million in income for the 2001 and 2002 tax years. Cole ultimately pleaded guilty to one count of tax evasion.

The case was investigated by the Internal Revenue Service Criminal Investigation.

“After years of deceit, Scott Cole has been dealt the consequences of evading his federal income taxes,” said Kathy A. Enstrom, Special Agent in Charge of IRS Criminal Investigation. “Our sworn mission is to protect the federal tax system from those that cheat it. Today’s sentencing of Mr. Cole emphasizes the Internal Revenue Service will continue their pursuit of those who use fraudulent methods to corrupt our nation’s tax system.”

Cole, who resigned from the Indiana bar in 2014 after a complaint filed by the Indiana Supreme Court Disciplinary Commission charged him with filing fraudulent tax returns, is set to serve two years of supervised release following his imprisonment and is ordered to pay full restitution to the government.