IRS Whistle Blower acquitted of Tax Fraud Charges*
By Peymon Mottahedeh
The Internal Revenue Service’s efforts to silence one of its most formidable critics backfired when a jury acquitted Joe Banister, a former IRS criminal investigation division special agent and fraud expert. On June 23 2005, in Sacramento, CA, a unanimous jury of 12 found Banister not guilty of three counts of assisting in preparation of false tax returns and one count of conspiracy to defraud the government.
Had the IRS been successful in convincing the jury that Banister was guilty, he would have faced going to prison for up to 14 years. Since 1999, Banister had been trying to get the government to answer the questions that he and scores of other Americans have been raising about the legality and imposition of the federal income tax on the average working citizen.
Banister wrote a detailed 95-page report on this issue and presented it to his IRS superiors for an answer. He went to Washington to meet with the President, heads of Congress and the IRS. He also appeared on C-Span2 and in nationwide newspaper advertisements telling of questions he had. Rather than answering Banister’s report, the IRS encouraged Banister to resign, which he did. At every turn, the federal government refused to answer Banister’s questions.
IRS and the Department of Justice decided to “answer” Banister by charging him with four tax-related charges in November 2004. IRS claimed that a major part of these “crimes” was Banister’s speech in October 2000 at Cencal Aviation Products in Northern California. This speech was videotaped and reported on by David Cay Johnston of The New York Times.
At this two-hour meeting, Banister presented a case for the questionable nature of the way the federal income was imposed on ordinary Americans and the suspicious behavior of the government in refusing to answer these questions.
During closing statements in the trial, Assistant U.S. Attorney Robert Twiss argued to the jury that Banister used false means to “wipe out” taxes that were allegedly owed by Cencal owner Al Thompson, and that to Banister, “it was all about the money, the money.”
However, an April 2001 email between a Department of Justice lawyer named DiLeonardo, who had worked with Banister while Banister was working at the IRS, and Ron Semino, the chief of the Western Division of the Department of Justice’s Tax Division, showed that the government viewed Banister to be the most visible personality in what many people today call “the tax honesty movement.”
After Banister was indicted, IRS Commissioner Mark Everson stated: “Joe Banister, a former IRS agent, knew exactly what he was doing. Tax professionals and employers who break the law will be held accountable.”
Apparently the jury agreed with Everson that Banister knew exactly what he was doing. However, they saw no crime in what Banister was doing. Two of the jurors, who spoke with AFP right after the trial, related the thinking that led to their decision.
They said the false tax return charges were “non-starters with the jury.” The jury saw that the IRS might have disagreed with the position of Banister on the tax returns. However, the tax returns contained no false information.
The jurors said they were surprised when the testimony part of the case ended, since they had yet to see or hear any evidence of a crime. They said the evidence showed that Banister was honest, straightforward, credible, believed in what he was doing and was trying to follow the law. They also believed that Banister was honestly trying to get answers, but the government consistently refused to answer his questions and address his concerns.
The government presented enough evidence to acquit Banister, they said. The jurors said they saw nothing deceitful or dishonest on Banister’s part. And, finally, they said the government simply presented no evidence of any crimes committed by Banister.
After a few hours of deliberation, the jury took a vote and six or seven of them were ready to acquit Banister of all charges. Other jurors still had doubts. But after the jury saw Banister’s video a second time, the remaining doubts as to Banister’s innocence were removed.
This defeat at the hands of one of the most visible figures in the anti-income tax movement dealt a serious blow to the IRS’s image of invincibility. It demonstrated that even in the 21st century, there are David’s like Banister who can beat the IRS Goliath.
The question remains; if Banister is correct in his belief that the IRS consistently misapplies the law, who is going to hold the IRS and officials like Everson accountable?
*This article was originally printed on the front page fo the American Free Press Volume 5 Week 28 www.americanfreepress.net.
Peymon Mottahedeh is the founder and president of Freedom Law School (FLS). FLS has printed and distributed the first edition of Banister’s 95-page report, titled “Investigating the Federal Income Tax.” You can obtain a FREE copy of Banister’s speech on the Federal Income Tax, IRS Fraud and Lies from FLS by calling them at (813) 444-4800 or by visiting our website www.livefreenow.org.
Below is a modified version of the original press release that Freedom Law School put out when our graduate Joe Banister defected from the IRS to the Freedom Movement. He spoke for the first time in public at our 1999 freedom rally about his conclusions concerning the fraudulent nature of the Federal Income Tax. We gave Mr. Banister our course “A Practical Road to Freedom from Oppressive Taxation and Control, Level 1”, “How to use the Law Library” book by HALT, and “Income Tax Basics” by Free Enterprise Society to help him study the Federal Income Tax which helped him come to legally correct conclusions. The newest version of the Banister Report called “Investigating the Federal Income Tax” is available through Freedom Law School for $30 plus $5 shipping and handling.
PRESS AND PUBLIC RELEASE
Who: Joseph R. Banister, Special Agent of the IRS, finds NO LAW THAT REQUIRES ANY AMERICAN TO FILE AND PAY INCOME TAX!
Where: At the Freedom law School’s Freedom Rally (www.livefreenow.org) to be held at Sheraton Hotel in Newport Beach, California on March 13-14, 1999, Mr. Banister will share his findings and Report with the American People.
To: All Freedom Loving Americans
From: Peymon Mottahedeh, President Freedom Law School
Date: February 25, 1999
Dear Fellow Americans,
Over the last 14 months, Freedom Law School along with Bill Conklin, Free Enterprise Society, Attorney Larry Becraft, Devvy Kidd and Bill Benson have been in communication with Joseph R. Banister who is a Special Agent (Criminal Investigation Division) for the IRS in San Jose, California. We have educated Mr. Banister as to how and why there is NO LAW THAT REQUIRES ANY AMERICAN TO FILE AND PAY INCOME TAX!
Mr. Banister with his own time and money has verified that:
- There is NO federal STATUTE (law written by Congress of the United States) which REQUIRES ANY AMERICAN TO FILE AND PAY INCOME TAX.
- The 16th AMENDMENT (income tax) to the U.S. Constitution was NOT RATIFIED by the PROPER NUMBER OF STATES .
- The U.S. Government operates NOT by revenues from the Income Tax, but by borrowing MONEY, which has been CREATED OUT OF THIN AIR, from the Federal Reserve Banks.
Below you will find a copy of the E-Mail which Mr. Banister sent me. Mr. Banister had written a 90 page report of his investigation of the Income Tax on February 11, 1999. This report is fully backed up by references to the U.S. Constitution, the IRS Code, Internal Revenue Manuals and court cases.
Mr. Banister presented this 90 page report to his superiors and asked them to present it to the highest ranks of the IRS, up to and including the Commissioner of IRS, Mr. Charles O. Rossotti. Mr. Banister informed the IRS leadership that unless they could point-by-point refute his findings, Mr. Banister would resign from his position INSTEAD OF ENFORCING A NON-EXISTENT LAW!
Apparently the Commissioner of IRS, Mr. Charles O. Rossotti and the high level officials of the IRS who each have taken an oath to “uphold and defend the U.S. Constitution from all enemies foreign or domestic,” have VOLUNTARILY chosen to COMMIT TREASON on the American People by refusing to review and consider the findings of Mr. Banister. His findings squarely challenged the lawful basis of the IRS enforcing a NON-EXISTENT and VOLUNTARY INCOME TAX on the American people by use of VIOLENT FORCE!!!
On February 17, 1999, Mr. Banister was called into his Chief’s office. Mr. Banister was informed that his report had been reviewed “by the highest levels of the IRS.” Mr. Banister was given a memorandum which in part read: “The Internal Revenue Service will not be responding to your request and will provide you with the necessary paperwork to tender your resignation. You will be placed on administrative leave effective upon receipt of this memorandum for a period of seven calendar days to consider what actions you wish to take.”
Today, February 25, 1999, the anniversary of the alleged ratification of the 16th Amendment, Mr. Banister resigned from the IRS so that he may freely and fully inform the American people of his findings regarding the income tax and the U.S. Government.
Mr. Banister will be appearing at Freedom Law School’s 1999 Freedom Rally on March 13-14th, at the Sheraton Hotel (949)833-0570, 4545 Mac Arthur Blvd, Newport Beach, California to share his findings and release his report entitled “INVESTIGATING THE INCOME TAX: A PRELIMINARY REPORT” to the American People.
“All that is needed for Evil to conquer, is for good men to do nothing!”
“Price of liberty is eternal vigilance.”
“If not now, when?”
“If its to be, its up to me.”
We at Freedom Law School encourage you to investigate this Report of Mr. Banister regarding the Income Tax and the U.S. Government and let your local IRS agents/officials, Congressmen, Senators and President know what you want them to DO in response to Mr. Banister’s Report. You can find the E-Mail and phone number of your congressmen at www.house.gov .
Please share this information with the Freedom Loving American People.
***Below is the full text of Mr. Banister’s E-Mail to Freedom Law School***
Well, the day of reckoning has arrived. On February 11, 1999, in my capacity as a Special Agent and federal law enforcement officer sworn to support and defend the Constitution of the United States, I submitted a “preliminary report” to the Chief of the IRS Criminal Investigation Division for the Central California District. My report summarized my findings regarding allegations that the income tax and filing of federal income tax returns is voluntary, that the 16th Amendment was never ratified, and that income taxes are not used to pay for daily government operations.
In order to ensure that unnecessary and unwarranted delay would not occur, I requested that my report be forwarded to top officials in the IRS up to and including Commissioner Charles O. Rossotti, and I respectfully requested that the Commissioner or his designee respond to the evidence in my report within 30 days. Today, my Chief called me into his office and gave me a memorandum. The memorandum dated February 17th, 1999, read in part:
The Internal Revenue Service will not be responding to your request and will provide you with the necessary paperwork to tender your resignation. You will be placed on administrative leave effective upon receipt of this memorandum for a period of seven calendar days to consider what actions you wish to take.
I was told that officials at the highest levels of the Internal Revenue Service were consulted regarding a response to my report. Apparently, I have now joined the ranks of every other taxpayer who ever was ignored or otherwise rebuffed by the Internal Revenue Service when they petitioned the IRS for a reasonable explanation. The only conclusion that I can reach is that those officials thought it was better to rebuff my request and pass up a golden opportunity to prove my research wrong than to have to admit that so-called “tax-protesters” and other supporters of the U.S. Constitution have been right all along. Ironically, had the IRS taken the time to address my concerns, or perhaps perform the simple task of proving the allegations wrong, I would have gladly been their spokesman advising taxpayers not to fall for these untrue allegations for the rest of my career.
As the memorandum states, I have until Friday, February 26th, 1999, the day after the 86th anniversary of the alleged ratification of the 16th Amendment, to tender my resignation. This is certainly a sad day in my life. Although I was hoping for a better result, I learned today after over two years of investigation that the Internal Revenue Service is everything that the so-called “tax protesters” said it was; non-responsive, unable to withstand scrutiny, tyrannical, and agency oblivious to the rule of law and the U.S. Constitution.
May God help us all.
Joseph R. Banister
President – Freedom Law School
(813) 444-4800 | www.livefreenow.org