Judge in Rodney Miller trial severs one of two counts of tax fraud
Published: September 4, 2013
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ST. THOMAS - Rodney Miller's tax fraud trial is scheduled to continue this morning in U.S. District Court on St. Thomas.
The trial of the former Schneider Regional Medical Center chief executive officer - on one count of assisting and advising in the preparation of false income tax returns - got under way Tuesday as the prosecution and defense squared off in federal court.
Assistant U.S. Attorney Kim Chisholm said the case is about Miller's aiding and abetting, and causing a false tax return - which seriously underreported his income and lowered his tax liability - to be filed for 2006.
Gabriel Villegas, Miller's attorney from the Federal Public Defender's Office, said that it was a case "about a costly mistake," and indicated there were issues pertaining to Miller receiving his W-2 and 1099 tax forms for that year. Villegas raised the question of Miller's intent and urged jurors to keep an open mind and enter a not guilty verdict.
The case is rich in documents, and much of the testimony on Tuesday came as Chisholm moved a flurry of documents into evidence.
Jury selection in the matter went quickly, with nine women and six men, including alternates, chosen before 11 a.m.
District Judge Curtis Gomez, presiding over the case, gave jurors a quick break before the trial started, while attorneys argued motions.
Miller sat quietly as the lawyers argued before the case began about the possibility of dismissing one of the two charges he was facing.
Miller originally was indicted in April on two counts of assisting and advising in the preparation of false income tax returns, in connection with his 2006 and 2007 taxes.
Villegas had asked the judge on Friday to dismiss the count stemming from Miller's 2007 return, contending that the Virgin Islands was not the proper venue for that charge.
Villegas argued that the case should be heard in Florida, because Miller was living in Florida when he had a Florida tax preparer do his 2007 taxes, which were filed electronically there. Florida is where the criminal acts are alleged to have been committed, Villegas said.
Eventually, after Gomez expressed "great concern" about whether the venue for that charge was proper in the territory, Chisholm asked the judge to sever that count, before the jury was sworn-in, so that there would be no issues with double jeopardy in filing that case in Florida.
Gomez severed the charges, and the trial proceeded on the first count.
The first count alleges that Miller caused a 2006 Form 1040 individual income tax return to be filed with the V.I. Internal Revenue Bureau in his name that he knew was "materially false and fraudulent," in that the return reported total income of $265,198, when he knew "that his true total income was substantially more than the amount reported."
As opening statements got under way, Chisholm told the jury that Miller made more than $500,000 in 2006, although as a result of Miller underreporting his income, his tax liability was far less than it should have been. His tax liability would have been more than $80,000 if a false return had not been filed, she said.
Villegas told jurors that a lot of the numbers in the case are not in dispute. He told them that while Miller was CEO, he was paid part of his salary through the V.I. Finance Department and part from hospital operating funds.
Miller was employed by Schneider Regional from May 2002 to November 2007.
Many of the witnesses have testified before on the same matters in V.I. Superior Court.
The U.S. Attorney's Office has drawn from a multitude of documents that the V.I. Attorney General's Office used during its prosecution of Miller and two other former hospital executives who are accused of conspiring together to steal large sums of money from the hospital.
Testimony during a 2011 criminal trial in that case in V.I. Superior Court indicated that between August 2005 and November 2007, Miller received more than $2 million from the hospital and that he had transferred it from a hospital bank account to his personal bank account.
That Superior Court trial, which lasted six weeks, ended in a mistrial on June 24, 2011, when the jury deadlocked and could not come to a verdict on any of the charges after deliberating for five-and-a-half days.
Miller and former Schneider executives Amos Carty Jr. and Peter Najawicz are scheduled to be retried on those charges in October. Carty and Najawicz are not charged in connection with the federal case against Miller, although their names already have been mentioned during testimony in the tax case as documents are admitted into evidence.
Documents entered into evidence on Tuesday include letters and emails, evidence of expense reimbursements, Notice of Personnel Action forms, bank records, signature cards, tax documents, Miller's contracts and W-2 forms.
The maximum sentence for a conviction on the charge is three years in prison.
- Contact Joy Blackburn at 714-9145 or email email@example.com.