WASHINGTON, July 29 (UPI) -- A grand jury in New Orleans has indicted two attorneys for alleged income tax evasion while hiding huge legal fees, the Justice Department said Thursday.
The department said attorneys Harold Molaison and David Loeb, both of Jefferson Parish, La., sued the federal government on behalf of landowners for declaring their property wetlands, then tried to hide their fees as non-taxable plaintiff income from the suit.
The landowners agreed to pay Molaison and Loeb approximately $2 million dollars in legal fees out of an $8.25 million settlement.
The indictment alleges Molaison reported taxable income of $9,507 for calendar year 1996, when in fact his taxable income was $747,058, and that Loeb reported taxable income of $2,021, when in fact his taxable income was more than $1 million.
Each defendant is charged with conspiracy and one count of tax evasion.
If convicted, each defendant faces a maximum potential sentence of 10 years in jail and $500,000 in fines.