Billie Wayne Spradling, Jr., a Lubbock businessman who pled guilty to a federal felony charge related to a bankruptcy matter, was sentenced on Friday to 24 months in prison, announced U.S. Attorney Richard B. Roper of the Northern District of Texas. In October, Spradling, 49, pled guilty to one count of false account in a bankruptcy case. U.S. District Judge Sam R. Cummings also ordered Spradling to pay $196,786.96 restitution for disbursement to the U.S. Bankruptcy Trustee in Lubbock. Spradling must surrender to the Bureau of Prisons on February 1, 2008.
In a related case, on December 21, 2007, Spradling's attorney, Steve A. Claus, who is also a Certified Public Accountant in Lubbock, was sentenced by Judge Cummings to three years probation and ordered to pay a $5000 fine. Claus, 53, pled guilty to a misprision of a felony.
In documents filed in Court, Billie Wayne Spradling Jr. admitted that on October 30, 2002, he fraudulently failed to disclose $196,786.96 in assets and income from his cotton brokerage business, ACSI II, in documents he filed in a pending involuntary Chapter 7 bankruptcy case against him. The schedules Spradling and his bankruptcy attorneys filed relied on false business and personal income information. Spradling falsely represented his financial affairs in those schedules to officers of the bankruptcy court, the creditors, the trustee, and the U.S. Trustee.
Spradling admitted that he conducted his business with no distinction between the corporate and personal businesses. He drew no set salary from his corporation, but merely funded his personal expenses by indiscriminately depositing corporate income into his personal accounts, transferring funds among his many accounts, and by paying personal expenses from the corporate accounts.
The documents filed further state that Claus performed legal and accounting work for Spradling in connection with his ownership and operation of ACSI II. He prepared financial statements and tax returns for ACSI II and his represented Spradling and ACSI II though the filing of the involuntary bankruptcy petitions. Although Claus didn't represent Spradling in the bankruptcy proceedings, the bankruptcy lawyers contacted him regarding the preparation of Spradling's bankruptcy schedules. Claus had reviewed in detail all of Spradling's financial information that was in his office and knew that the financial information that was sent to the bankruptcy lawyers was false because they relied on false business and personal income information.
Claus admitted that he knew the schedules were false, and that constituted bankruptcy fraud, and that he concealed it. A misprison of a felony is a crime in which someone has concealed from authorities the fact that a federal felony has been committed. Bankruptcy fraud is a felony. Although mere failure to report a felony is not a crime, a defendant must commit some affirmative act designed to conceal the fact that a federal felony has been committed.
U.S. Attorney Roper praised the investigative efforts of the Internal Revenue Service - Criminal Investigation. The cases were prosecuted by Assistant U.S. Attorney Paulina M. Jacobo of the U.S. Attorney's Office in Lubbock, Texas.
Source: U.S. Attorney's Office
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