Sunday, July 15, 2012

Mel Green Catches Alaska's Biggest Tax Cheat - Jerry Prevo

Mel Green with me at the 2009 Prop. 64 battle
Richard Mauer's story in Sunday's Anchorage Daily News gives credit where it is due in this, perhaps the unravelling of the biggest religious-based tax scam in the history of Alaska:
[On August 29, 2011] Before Superior Court Judge Frank Pfiffner accepted Allen Prevo's motion to seal the court file, an advocate for Anchorage gay, lesbian and transgender rights, Melissa Green, obtained some of the documents and wrote about the case on her blog, BentAlaska. Prevo has long been opposed to gay rights legislation and was active against the April gay rights ballot measure.
Mel's August 29, 2011 post at BentAlaska, and later at Henkimaa, opened the door.  Soon, the Anchorage Daily News took the matter seriously:
The Daily News successfully sued to open the divorce file and published a story about the church properties Jan. 15.
 One can only wonder that had we been left only with Mel Green's research, and no followup by the ADN,  whether the Anchorage tax assessor would have investigated the fraud.  We may never know.

Mauer writes today:
McGee said he asked the Baptist Temple to provide every document in its files concerning property ownership. His staff also reviewed personnel files for promises made to Baptist Temple employees regarding their homes.

The church turned over a 2001 sales agreement for Cobaugh for his six-room, 1,824-square-foot home on Sunflower Street, which he still occupies. With the statute of limitations allowing the city to only go back to 2006, the unpaid tax bill for that property is $25,804.

Taxes from 2006 on Allen Prevo's home total $35,483.

The city investigators found two other pastors, Clary and the Rev. Tony Smith, had oral agreements with similar terms. McGee said because Clary and Smith could not use those agreements to force the Baptist Temple to hand over the deeds when the homes were paid for, he determined that those properties were correctly exempt from taxes.

As for Jerry Prevo himself, he said in an interview with the Daily News on Dec. 28 that he wasn't building any personal equity in his home on Baxter Road near the Baptist Temple. His housing agreement with the church allows him and his wife to remain there for life but doesn't provide for a transfer to his name, he said.

But that statement was called into question by a notarized document that city investigators found in the Baptist Temple files dated Jan. 31, 2012, a month after the interview with the Daily News, that purported to document the termination of a sales agreement with Prevo six years earlier.

The document was signed by Floyd Damron, chairman of the church's governing Board of Deacons. The note, written "To Whom It May Concern," said that the Baptist Temple and Jerry Prevo had in fact entered into an installment sales agreement in 1994. The note said the agreement "was terminated" Dec. 24, 2005.

Read more here:

Read more here:
The amount the city might have collected but for the statute of limitations is far larger than the $61,000.00 they will collect.  The tax assessor will not pursue a penalty, interest or other charges:
The ruling will require the church to pay current taxes and six years of back taxes on each of the houses, the most he could levy under the statute of limitations, McGee said. He will not attempt to collect interest or penalties because the taxes were never billed and therefore weren't technically delinquent. He found no evidence that the church or any of its officials committed tax fraud, only that they misinterpreted the law, he said.
McGee is being quite charitable.  Back in August 2011, when Green's investigation started this ball rolling, I wrote:

Read more here:
Frankly, in my opinion, looking at how this tax evasion and cheating scam is structured, we should not be calling the Anchorage tax assessment people, we should be calling the white collar crimes units at the Anchorage Police and the office of special prosecutions at the Alaska Department of Law.  

Whoever structured this scam knew it was a scam, and should be indicted and prosecuted.  The ABT should lose their hallowed tax exempt status.
Nothing that came out as a result of the ADN lawsuit, or in the information that is emerging from McGee's office changes my mind on this.  

Good job, Richard Mauer.

Excellent job, Mel Green!

Read more here:


Anonymous said...

You are right on. This is a straight-up scam and if Prevo gets away with it all hell should break loose. Mark my words: From now on, there will be weakened enforcement as anybody can now plead ignorance despite obvious criminal activity. The municipality turned an eye to this and now the cat is out of the bag.

Anonymous said...

They clearly attempted to structure their transactions to get around the stated intent of the law, a law that the legislature should never have passed to start with. I would not have expected ethical, Christian behavior from the Prevo Palace crew, and the legislature shouldn't have, either.

Homosexuality isn't mentioned in the Ten Commandments, but lying and stealing are. Before ABT decided to concern themselves with the personal lives of those created gay by God, perhaps they should have cleaned up their own act, been truthful about what they were doing and stopped stealing property tax from their neighbors. Perhaps they might also have taken the $80,000 they gave to their PAC and used it to feed, house, and clothe the needy among us. Silly me. That would be the Christ-like thing to do. Mote/beam, anyone?

Anonymous said...

Worked for Prevo in the 90's. I absolutely remember this verbal well as the tyrant-style leadership he imposed, and probably still does. The staff feared him, but not out of respect! He can't reach out to the community in love until he learns to treat his staff with love.