SEATTLE (AP) — The Seattle-area men have pleaded guilty to federal charges stemming from an illegal tax shelter that enabled wealthy clients — including the philanthropist Robert Wood Johnson IV and Hollywood mogul Haim Saban — to avoid paying taxes on $1.3 billion in capital gains.
The men ran an investment firm called Quellos LLC. Jeffrey Greenstein of Mercer Island was its chief executive and Charles H. Wilk was its tax attorney.
The U.S. attorney’s office in Seattle says both pleaded guilty Friday to charges of conspiracy to defraud the government and aiding in the filing of a false tax return. They agreed to pay the IRS $7 million in penalties and to speak to their graduate schools about business ethics.
In exchange the government says it won’t recommend any more than six years in prison when the two are sentenced.
The government says the firm’s clients didn’t know about the scheme and have paid back $240 million in back taxes.
