9 of the Most Audacious Tax Fraud Cases

You can’t win against the IRS. Just ask the people who were caught trying to avoid their tax bills.

Founding Father Benjamin Franklin once said that “in this world, nothing is certain except death and taxes.” Somebody really should have reminded the people on this list before they committed tax fraud. From actors to billionaires to mobsters, these folks tried to cheat Uncle Sam. But nobody is exempt from the IRS, no matter how much money they have—or how famous they might be.

Wesley Snipes

LOS ANGELES, CA - AUGUST 11, 2014: Wesley Snipes at the Los Angeles premiere of his movie "The Expendables 3" at the TCL Chinese Theatre, Hollywood.

Wesley Snipes was one of the biggest stars at the box office for a brief moment, helming the Marvel Comics Blade franchise long before there was an MCU. Unfortunately, he didn’t pay the right amount of taxes on his Hollywood paychecks. Snipes ended up being sentenced to prison over the large amounts of cash that he owed Uncle Sam.

According to Essence, “The IRS tried to collect $23.5 million from Snipes in outstanding taxes for the years 2001 to 2006 back in August 2013 shortly after he completed a three-year sentence in federal prison for tax-related offenses.” Snipes tried to fight for a reduced settlement in court to the tune of $850,000. He wasn’t able to get the amount owed reduced by quite that much, but the judge did uphold the IRS’s offer of a reduced payment of $9.5 million.

Read More: How The World’s Wealthiest People Spend Their Money

Al Capone

Al Capone didn’t make a secret of his life as a criminal kingpin. During the height of his power, he ran Chicago’s underworld. The Prohibition era was good to Capone, and he spent seven years on top of the world. But, as we all know, the higher you fly, the harder you fall.

Capone ended up going to prison for 11 years for tax evasion. It’s become something of a joke, considering the extent of his crimes. While other law enforcement branches were unable to get charges to stick, the IRS successfully argued that even though his money was earned illegally through bootlegging and other rackets, Capone still owed income taxes. Even then, he was only convicted on five out of 22 counts of tax evasion. He served most of his sentence at the newly opened Alcatraz Prison.

Walter Anderson

Walter Anderson’s career was spent in telecommunications, but his real passion was space. The entrepreneur founded the International Space University and even tried to buy Mir, the Russian space station, and turn it into a tourist attraction. Anderson believed deeply in commercial space travel. Unfortunately, he didn’t believe in paying his taxes.

Anderson was arrested and charged with evading taxes, allegedly having hidden at least $450 million in offshore accounts. Newspapers throughout his arrest and trial in the early 2000s labeled him the biggest tax cheat in history. The Justice Department claimed that Anderson owed the U.S. government more than $200 million. He pled guilty in 2006 and was sentenced to nine years in prison. The story has a little bit of a silver lining for Anderson, however. A small mistake in the Justice Dept’s filing meant that technically, Anderson didn’t have to pay back the federal government, only the District of Columbia. That mistake saved him $100 million!

Richard Hatch

'Survivor: Borneo' cast

When Survivor premiered in 2000, no one really knew what to expect. Some of the contestants treated the experience like a real-life Gilligan’s Island, but one man played to win. Richard Hatch (back row center), the first winner of the long-running reality competition, laid the groundwork for the ruthless gameplay that has continued through more than 30 seasons of the show.

Future winners didn’t just learn how to form an alliance from Hatch; they also learned to file taxes on the million-dollar prize. Hatch didn’t report his Survivor payday as income to the IRS, even though his winnings were broadcast on live TV. He owed somewhere between $440,000 and $235,000, but he paid not a dime. Hatch, who was criticized for his arrogant attitude on the show, bragged that he’d dodged his tax bill on Howard Stern’s radio show. He paid for that arrogance with 51 months of his life after he was found guilty of tax evasion.

Robert Brockman

Robert Brockman has the dubious honor of unseating Walter Anderson as the biggest tax cheat in U.S. history. Brockman worked his way up through the early days of computer technology, eventually becoming the CEO of Reynolds & Reynolds, a company that specializes in software for car dealerships. He wasn’t a household name like Bill Gates or Steve Jobs, but Brockman seemed to be doing just fine in his tech empire.

Everything came crashing down in September 2020. He was indicted on 29 counts of tax evasion, wire fraud, and money laundering, as well as failing to disclose overseas assets. Investigators allege that Brockman hid a staggering $2 billion from the IRS over a period of 20 years. According to the Wall Street Journal, “Court documents and interviews with his former employees, business associates and his younger brother portray him as a brilliant, sometimes penny-pinching executive with an anti-government streak that led him to regard the IRS as a corrupt organization unfairly targeting taxpayers.”

Just because you don’t agree with the IRS doesn’t mean they can’t come after you with the full force of the law.

Nicolas Cage

VENICE, ITALY - AUGUST 30: Actor Nicolas Cage attends 'Joe' Premiere during The 70th Venice Film Festival on August 30, 2013 in Venice, Italy

Nicolas Cage is notorious for his lavish spending habits, blowing through an estimated $150 million fortune. During that period, he also wasn’t paying his taxes. In 2009, the IRS knocked on his door. The actor owed over $6 million to the government.

Cage signed on to every movie he could do, choosing lower-budget flicks when a string of Hollywood flops stalled his mainstream career. Ironically, this ushered in one of the most artistically exciting periods of his career. Surprise indie hits like Mandy made Cage cool again, but he says that he never phoned in a performance even when he knew the movie wasn’t great. His tireless work ethic saved him from having to file for bankruptcy, and Cage has paid off his tax debt to the IRS.

Read More: Celebrities Who Went From Riches to Rags

Willie Nelson

Country music legend Willie Nelson went through something of a rough patch 30 years ago, to put it mildly. In 1990, federal agents raided properties owned by Nelson in six different states, seizing all the assets they could get their hands on. That included his master recordings and his gold and platinum records! The IRS said Nelson owed $32 million in back taxes for income that his accountants had hidden—and hidden badly.

Nelson claimed that his accountants had told him everything they did was by the book. The IRS didn’t care; they still wanted almost $17 million in cash. Eventually, they settled on $9 million, and Nelson raised the money by releasing a two-disc album called The IRS Tapes: Who’ll Buy My Memories. The title referred to the government auction of his seized property. As Taste of Country explains, “Fortunately, much of the property was bought by friends and supporters who gave it right back to him.” By 1993, Willie Nelson had paid his debts—and he’s gone on to poke fun at himself in an ad for tax prep company H&R Block.

H. Ty Warner

Beanie Babies

H. Ty Warner, the toy tycoon behind the Beanie Babies craze, ran into trouble with the IRS. He was caught trying to hide income from his business—despite the fact that Beanie Babies were obviously selling like hotcakes. In 2014, he was sentenced to two years’ probation “for failing to report more than $24.4 million in income, and evading nearly $5.6 million in federal taxes, from millions of dollars he hid for more than a decade in secret foreign financial accounts at two banks based in Switzerland.”

He received a relatively lenient sentence without jail time—something that the district attorney on the case thought was blatantly unfair. “‘Society will be best served to allow [Warner] to continue his good works,’” U.S. District Judge Charles Kocoras said in imposing the sentence. Judge Kocoras also ordered Warner to perform at least 500 hours of community service for at least three Chicago high schools and to pay a $100,000 fine.”

Leona Helmsley

Real estate mogul Leona Helmsley was known as the “Queen of Mean” thanks to her highly publicized attitude. During her trial for tax evasion in the late 80s, a housekeeper quoted Helmsley as saying, “We don’t pay taxes; only the little people pay taxes.” It’s not quite as catchy as “Let them eat cake,” but the quote would hound her for the rest of her life.

The Helmsleys owned billions of dollars in property and lived in a Central Park penthouse. However, they had a bad habit of refusing to pay for anything, including the work of their contractors and luxury furnishings for their properties. They dodged sales tax and income tax for as long as possible, but eventually, their misdeeds caught up to them in court. Harry Helmsley was ruled unfit to stand trial because of his rapidly failing health, and Leona had to face the consequences alone. She was initially sentenced to 16 years in prison, but several convictions were later overturned.

Leona Helmsley spent 21 months in prison, and her husband passed away just three years after she was released. Although she inherited more than $5 billion, Leona spent the rest of her life in relative isolation. She left most of her fortune to a charitable trust—but she also set up a $12 million trust fund for her dog.

Latest News