Walter Anderson (tax evader)

For other people of the same name, see Walter Anderson (disambiguation).

Walter C. Anderson is an American telephone entrepreneur who was arrested and convicted in the largest tax evasion case in United States history.

Early life and career

Anderson grew up in Silver Spring, Maryland. He used his mother's maiden name, Anderson, rather than his father's name, Crump, due to a divorce. He later moved to Fairfax, Virginia, where he graduated from Woodson High School in 1971. He did not graduate from college, though he claims to have attended several institutions, including the University of Richmond, Northern Virginia Community College, and George Mason University.

Anderson began his telecommunications career as a salesman at MCI Communications in 1979. He entered into entrepreneurship in the 1980s and 1990s, during which he heavily invested in several telecom companies, which were later sold for large profits. Anderson bankrolled many early private space ventures and paved the way for the "astropreneurs" who followed. His most high-profile space investment was MirCorp, the 1990s start-up that briefly privatised Russia's ageing Mir space station. He reportedly pumped as much as $30 million into the venture. He also invested into Rotary Rocket.

Tax evasion case

Anderson was arrested on February 26, 2005 at Dulles International Airport as he was returning from London. He was accused of hiding his wealth in off-shore companies in Panama and the British Virgin Islands in an attempt to avoid taxation on his income. The companies reportedly earned nearly $500 million in revenue during a five-year period.

On September 8, 2006, Anderson pleaded guilty to two felony counts of evading taxes and one felony count of defrauding the District of Columbia government in plea agreement. He was sentenced to nine years in prison, and agreed to turn over $200 million in restitution within ten days of sentencing.

As part of the plea agreement, Anderson admitted to hiding $365 million of income by using aliases, shell companies, offshore tax havens, and secret accounts. Anderson also admitted to having earned more than $126 million in 1998, a year for which he claimed an income of $67,939 on his federal tax return, for which he had paid only $495 in taxes.

On June 15, 2007, federal district judge Paul L. Friedman ruled that Anderson would not have to pay $100 to $175 million of his restitution to the federal government due to a typographical error by the government in the plea agreement. In his ruling, Friedman stated that he did not have the authority to "read something into a contract that is not there or to interpret uncertain language in the government's favor". Anderson will still have to pay $23 million in restitution to the District of Columbia government, and the government may sue for the difference in civil court.

According to a web site entitled "JusticeForWalt": "On June 12, 2009 the Tax Court issued an ORDER [sic] accepting the IRS decision to conceded [sic] all the tax and penalty issue for 1995, 1996 and 1997. The ORDER indicated that a judgment for those years would be entered in Walter Anderson's favor."

On March 7, 2011, the U.S. Tax Court issued a decision ordering Walter Anderson to pay $141,497,773 in tax deficiencies and $105,984,341 in penalties for a total of $247,482,114 owed to the IRS. Additional interest on the $247,482,114 Anderson owes could amount to an estimated $248,962,929.

CNBC television program "The American Tax Cheat," April 14, 2011 featured Walter Anderson speaking in an interview from federal prison.

At this link Walt speaks in an internet radio interview about his legal case and plans to continue his philanthropic assistance of space development: http://www.thespaceshow.com/detail.asp?q=1237. He also speaks at length on his detention and about his contention that he was effectively unable to defend himself in the court. He explains why he believes he was forced to plead guilty, despite the fact that he considers himself innocent.

Anderson is incarcerted at the Federal Correctional Institution at Fairton, New Jersey. His projected release date is December 29, 2012.