PHOENIX—Alpine property owner Kevin Scott Wynn 59, was sentenced to 46 months in federal prison by United States District Judge Susan M. Brnovich on March 31 in Phoenix. He was fined $7,500 and ordered to pay more than $700,000 in back taxes, fees and assessments. Wynn was found guilty in December 2019 on all the crimes the government had charged him with: one count of tax evasion, a felony, and three counts of failing to a file tax return, all misdemeanors. The trial lasted three days.
Wynn was indicted Dec. 18, 2018 by a federal grand jury. The indictment says that “Starting in 1995, Kevin Scott Wynn determined to no longer file personal income taxes, or to pay taxes on his personal income to the Internal Revenue Service (“IRS”). Wynn kept the money for himself and spent it on his personal lifestyle.” The indictment states that Wynn has worked in the construction industry, and controlled companies called SCC Southwest Construction, Black River Construction and Development, Wynn Companies and “In later years, he also operated a Mesa bar known as Monsterland.”
Wynn came to the attention of the IRS based on “earnings reported to the IRS by third parties,” says the indictment. That probably means 1099s, forms which persons must file with the IRS letting them know how much money, if $600 or more, that they paid to someone in a particular tax year. When the 1099s don’t match up with the receiving person’s income filings the IRS “assesses” a tax on an estimate of income for the non-filer; in Wynn’s case, $43,311 for 1999; $89,848 for 2000 and $8,775 for 2002. These amounts are much higher now with the addition of penalties and interest.
The IRS also noted that when Wynn applied for a refinance on his Alpine property in 2006, he told the lender that he had paid $40,000 in estimated taxes for 2005. In fact, claims the government, Wynn hasn’t filed personal income tax returns since 1995. Then the government got ahold of a credit application Wynn allegedly gave to a lender in 2010 in order to get a loan for “a BMW 6501 Coupe.” He claimed his salary was $25,000 per month and “additional business profit of $40,000 per month” in 2010, the indictment says.
After that, the IRS finally contacted him about paying up their “assessments” for tax years 1999, 2000 and 2002. The indictment says that Wynn wrote them back and said “I am more than willing to comply if it is ‘required’ or ‘Mandatory’”(sic), and demanded a letter from the IRS “saying just that.” Wynn told the Independent the same thing. He didn’t get such a letter, and didn’t pay up, either.
Somewhere along the way, the government filed tax liens in Navajo and Maricopa counties with the county recorders’ offices. Generally, the purpose of recording a tax lien is to give notice to anyone who intends to buy real property from Wynn or any lender who is thinking about loaning money to Wynn to buy real property, that the IRS can take the property and sell it to get their money. That’s when Wynn started a scheme to hide his cash, the government alleged.
The indictment claimed, and the jury apparently agreed, that Wynn had a female identified only as “A.F.” open a Bank of America account in California under her name and signature, and stashed his own money there, to the tune of $235,349 in 2011 and $161,425 in 2012
Federal law says that for a single count of tax evasion, Wynn can’t get more than five years in prison, or 60 months. But the range of sentence below that is unclear. Federal sentencing is complicated with charts, tables, additions to or subtractions from “base levels” of prison time starting points. In tax crimes, the starting point for prison time starts at how much in taxes the government lost.
Shortly after the December 2019 verdict, the prosecutors told the judge that their office would recommend 37 months in federal prison, but if Wynn paid up $765,429.00 in back taxes, penalties and interest before sentencing, the US Attorney would recommend 30 months.
Wynn’s sentencing was delayed because Wynn said he needed time to sell assets like a yacht in Florida, so that he could get restitution paid. He was due in US District Court in Phoenix on July 20, 2020 to be sentenced, but failed to appear. It was the third time the sentencing had been set and re-set. The court allowed Wynn to remain free pending sentencing, but under strict conditions including having to wear a monitoring ankle bracelet.
On the lam and the missing money
A few weeks before he was due in court in July 2020, Wynn withdrew $1.5 million from a business bank account, cut off his ankle bracelet and disappeared.
About two months after that, the US Marshals Service announced in a press release that Mexican law enforcement authorities apprehended Wynn on August 21 in an area of Mexico City called the Polanco neighborhood, a wealthy enclave there. He was carrying a fake ID; a Mexican voter registration card with Wynn’s picture, but bearing another name.
“Wynn spent a lot of time and money preparing for his life as an international fugitive,” said US Marshal David Gonzales in the press release. “Unfortunately for him, his life on the run was for only 53 days. My special thanks to our partners in the Republic of Mexico for their assistance in the capture of Wynn,” Gonzales said.
If the court or the U.S. Attorney had any inclination towards leniency for Wynn, they no longer had that sentiment after he was re-captured. Before Wynn ran, the prosecutors’ recommendation for his sentence was 37 or 30 months; but that changed to 57 months. As far as a discount off the prison time if Wynn payed up, Wynn claimed that when he was arrested outside his Mexico City apartment, he had left $1.25 million in cash and $300,000 in precious metals inside, which he was not allowed to access and which the Mexican authorities claim they have no record of.
March 31, 2021 sentencing
Wynn appeared in court via video link from a detention facility in Florence. IRS Criminal Investigation Special Agent and Public Information Officer Brian R.Watson attended the sentencing hearing. According to Watson, a number of Wynn’s family and friends, about eight persons, appeared in person to support him. Wynn argued for no incarceration and he admitted to having a “hardheadedness,” caused by events in his past. Wynn claimed that as a middle child he was sexually abused and lost an adult son who reportedly died in a wreck. These events, Wynn urged, instilled in him a lack of trust in, and resistance to, authority.
Judge Brnovich noted that in her view, Wynn “was still blaming others for the situation you are in,” said the special agent. In the end the court sentenced Wynn to 46 months in federal prison followed by a three-year period of “supervised release,” similar to probation or parole in a state court. He was ordered to pay the $700,000-plus tax bill and the $7,500 fine.