A San Diego physician was sentenced in federal court Friday to 41 months in prison for failing to pay taxes on more than $1 million in earnings over an eight-year period.
While handing down the punishment to osteopathy practitioner William Richard Bailey, U.S. District Judge Cathy Bencivengo also ordered him to pay $316,526 plus interest to the Internal Revenue Service and $61,151 to the California Franchise Tax Board.
In January, a federal court jury found Bailey, 55, guilty of eight counts of tax evasion.
As set forth in court filings and at trial, from at least 2004 through 2011, Bailey provided medical care to the patients of several clinics operated by at least two other local doctors.
Over that period, Bailey concealed his income of more than $1 million in a purported trust account, reporting nothing in taxable income or tax due to the IRS, according to prosecutors.
According to court documents and trial testimony, Bailey fabricated supposed trust documents by cutting and pasting them together, forged the signatures of known associates on documents, opened a bank account in the name of the “trust” and deposited his income into it.
Bailey then transferred funds and drew checks on that account to pay for more than $1 million of his own personal expenses, including the purchase of a home, two cars, a timeshare and about $400,000 in credit card expenses, prosecutors alleged.
In addition to mandating restitution to the IRS and state of California, Bencivengo also ordered Bailey to pay $16,696 in mandatory costs of prosecution and $80,000 in total fines.
Following his release from prison, Bailey will be placed on three years’ supervised release.
At the conclusion of this morning’s sentencing hearing, Bencivengo remanded Bailey directly into custody.
–City News Service
