Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States of America v. John Quinn Mckinney

July 13, 2012

UNITED STATES OF AMERICA, PLAINTIFF-APPELLEE,
v.
JOHN QUINN MCKINNEY, DEFENDANT-APPELLANT.



Appeal from the United States District Court for the Southern District of Illinois. No. 3:11-CR-30029-DRH--David R. Herndon, Chief Judge.

The opinion of the court was delivered by: Flaum, Circuit Judge.

ARGUED JUNE 8, 2012--

Before POSNER, FLAUM, and WILLIAMS, Circuit Judges.

John McKinney, along with his wife, brother, and sister-in-law, was charged in an eleven-count indictment with conspiracy to defraud, impede, impair, obstruct, and defeat the functions of the IRS in the collection of income taxes, 18 U.S.C. § 371; tax evasion, 26 U.S.C. § 7201; and false statements to revenue agents, 26 U.S.C. § 1001. McKinney entered a plea agreement and a factual stipulation with the govern- ment. At sentencing, he received a two-level enhancement to his base offense level for failing to report income exceeding $10,000 from criminal activity, U.S. SENTENCING GUIDELINES MANUAL ("U.S.S.G.") § 2T1.1(b)(1), as well as a two-level enhancement for obstruction of justice, U.S.S.G. § 3C1.1. He appeals these enhancements.

We affirm the district court.

I. Background

A. Tax Evasion

McKinney and his brother Robert own and operate McKinney Hauling, a construction business. In early 2003, the IRS filed a Notice of Federal Tax Liens against McKinney for taxes owed. Thereafter, the IRS pursued collection multiple times. McKinney avoided paying taxes by transferring money earned from his construction business into separate nominee accounts, which McKinney and his brother used for personal and household expenditures. He concurrently provided to IRS Revenue Officers false statements about his ability to pay the taxes he owed. He failed to pay taxes during 1999, 2000, 2002, 2003, 2004, 2005, and 2006.

Because of the federal tax liens, McKinney was unable to obtain a residential mortgage. Therefore, his wife, Chamethele, independently applied for and obtained a loan to purchase a home in Madison County, Illinois. On her application, she falsely stated that she was a full-time manager of McKinney Hauling with a gross monthly income of $15,374.23. Her husband signed a false employ- ment verification document to confirm her representations. He, however, earned the income used to pay for the home. Accordingly, the mortgage fraud diverted business income earned by McKinney into an asset purchased by his wife, enabling him to avoid the IRS tax assessment and lien. Chamethele McKinney defaulted on the mortgage on July 1, 2008.

McKinney's sister-in-law, Belinda McKinney, similarly applied for a loan to purchase a home in Madison County, Illinois. She, too, falsely declared that she was a full-time employee of McKinney Hauling, that she had been em- ployed for ten years, and that she earned $9,500 per month. The residential mortgage lender called McKinney to confirm that Belinda was a full-time employee. McKinney falsely represented that his sister-in-law was a full-time employee. She did not report such employment on her taX return. This financial transaction diverted business income earned by Robert McKinney into an asset owned by Belinda, thereby avoiding the IRS tax assessment and lien.

B. Obstruction of Justice

IRS Revenue Officers interviewed McKinney and his brother regarding their failure to pay income taxes. Both McKinney and his brother made false statements regarding their actual income and assets. On March 23, 2007, McKinney falsely stated that he lived at 1528 Gaty Avenue, East St. Louis, St. Clair County, Illinois, when, in fact, he lived with his wife at their Madison County home. On October 22, 2007, McKinney stated that he and his brother were thinking about closing their business because they had no work, which was untrue. On November 21, 2007, a Revenue Officer conducted a field visit with McKinney and his brother during which both brothers indicated that they lacked work and income. These state- ments were also false: they received income just before and after that meeting from their construction business. The false information provided by the brothers caused the IRS to close its investigation on December 13, 2007.

C. Procedural Background

Federal authorities ultimately discovered the brothers' tax evasion, and, on February 24, 2011, they charged McKinney with one count of conspiracy, one count of tax evasion, and three counts of making ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.