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June 9, 2006
1040
Checkmate?
DOJ Dismisses Felony Tax Prosecution
-- With Prejudice -- After PRA Defense Raised
Evidence OMB Complicit In Income Tax Fraud
DOJ & IRS Petitioned To Explain
On May 12, 2006 in Peoria, Illinois, the attorney for the U.S. Department of
Justice (DOJ) begged the court to dismiss all charges against IRS victim
Robert Lawrence in federal District Court.
The motion for dismissal
came on the heels of a surprise tactic by Lawrence’s defense attorney Oscar
Stilley.
The tactic threatened
exposure of IRS’s on-going efforts to defraud the public. The move put DOJ
attorneys in a state of panic that left them with only one alternative: beg
for
dismissal,
with prejudice.
Stilley’s tactic paid
off. Sixty days earlier, the DOJ had indicted Lawrence on three counts of
willful failure to file a 1040 form, and three felony counts of income tax
evasion. The federal Judge dismissed all charges with prejudice,
meaning the DOJ cannot charge Lawrence with those crimes again.
The trial was to have started on Monday morning, May 15th.
On Wednesday, May 10,
Stilley mailed a set of documents to the DOJ in response to DOJ’s discovery
demands. The documents revealed to DOJ for the first time that Lawrence was
basing his entire defense on an act of Congress, 44 U.S.C. 3500 – 3520, also
known as the "Paperwork Reduction Act" (PRA).
In Section 3512 of the
Act, titled "Public Protection," it says that no person shall be subject to
any penalty for failing to comply with an agency’s collection of information
request (such as a 1040 form), if the request does not display a valid
control number assigned by the Office of Management and Budget (OMB) in
accordance with the requirements of the Act, or if the agency fails to
inform the person who is to respond to the collection of information that he
is not required to respond to the collection of information request unless
it displays a valid control number.
In Section 3512 Congress
went on to authorize that the protection provided by Section 3512 may be
raised in the form of a complete defense at any time during an agency’s
administrative process (such as an IRS Tax Court or Collection and Due
Process Hearing) or during a judicial proceeding (such as Lawrence’s
criminal trial).
In sum, the PRA requires that all government agencies display valid OMB
control numbers and certain disclosures directly on all information
collection forms that the public is requested to file. Lawrence's sole
defense was he was not required to file an IRS Form 1040 because it displays
an invalid OMB control number.
Government officials
knew that if the case went to trial, it would expose the fraudulent,
counterfeit 1040. They also must have known that a trial would expose the
ongoing conspiracy between OMB and IRS to publish 1040 forms each year that
those agencies knew were in violation of the PRA.
That would raise the
issue that the Form 1040, with its invalid control number, is being used by
the Government to cover up the underlying constitutional tort -- that is,
the enforcement of a
direct, unapportioned
tax on the labor of every working man, women and child in America.
Any information collection form, such as IRS Form 1040, which lacks bona
fide statutory authority or which conflicts with the Constitution,
cannot be issued an OMB control number. If a control number were
issued for such a form, the form would be invalid and of no force and
effect.
Under the facts and
circumstances of the last 24 years, it is safe to say that IRS Form 1040 is
a fraudulent, counterfeit, bootleg form. Government officials responsible
for this fraud should be investigated and face indictment for willfully
making and sponsoring false instruments.
Caught between a rock
and a hard place, the DOJ and IRS decided not to let the Lawrence case
proceed because it would reveal one critical and damning fact:
The PRA
law protects those that fail to file IRS bootleg Form 1040
The DOJ knew that it stood
a significant chance of losing the case, and if that happened, the press and
others would quickly spread the word, and leave only fools to ever file a
1040 again. Oscar Stilley’s pleadings and documents made these points quite
clear:
-
IRS Form 1040 violates the federal Paperwork Reduction
Act (PRA) and is therefore a legally invalid form.
-
Under the Public Protection clause of the PRA, no person
can be penalized for failing to file a 1040 if the IRS fails to fully
comply with the PRA.
-
The PRA statutes explicitly provide that a PRA challenge
is a complete defense and can be raised in any administrative or judicial
proceeding.
-
The IRS Individual Form 1040 has not and cannot comply
with the requirements of the PRA because no existing statute authorizes
the IRS to impose or collect the federal income tax from individuals.
That lack of bona fide authority makes it impossible for IRS to
avoid violating the PRA.
We The People Foundation has researched the facts, law and circumstances surrounding
this case, and has determined that:
-
A public trial would have opened a “Pandora’s Box” of
legal evidence and government testimony under oath that would establish
the IRS 1040 form as both fraudulent and counterfeit.
-
Oscar Stilley’s PRA defense “checkmated” the DOJ and IRS
-
The Office of Management and Budget (OMB) appears to
have been complicit with IRS in deceiving the public and in helping
perpetuate the 1040 fraud by promulgating federal regulations that negate
the plain language of the PRA laws passed by Congress and by allowing the
IRS to continually skirt the explicit requirements of those statutes
Accordingly, We The People Foundation has petitioned the U.S.
Attorney General, the IRS Commissioner, and Director of the OMB, requesting
an official explanation of their conduct in
Peoria.
See the petition
below. It includes links to all relevant statutes, regulations, court
decisions, Federal Register publications, law review articles, Lawrence case
pleadings, and the discovery documents sent by defense counsel Stilley to
the DOJ.
[ start letter ]
We The
People Foundation
For Constitutional Education, Inc.
2458 Ridge
Road, Queensbury, NY 12804
Telephone: (518) 656-3578 Fax: (518) 656-9724
VIA CERTIFIED RETURN RECEIPT MAIL
Hon.
Alberto R. Gonzales
Attorney General of the
U.S.
Dept. of Justice Rm. 4400
950 Pennsylvania Ave. N.W.
Washington,
DC
20530-0001
Mr.
Mark Everson, Commissioner
Internal Revenue Service
1111 Constitution Ave. NW
Washington, DC 20224
Re:
Petition for Redress of Grievance – No requirement to file fraudulent
1040 Form.
Gentlemen:
Please
take notice of this Petition requesting a public explanation of your recent
conduct in Peoria, Illinois, regarding the case of
U.S. v Robert
Lawrence.
What
you did seems remarkable by virtue of its inconsistency.
- On
March 17, 2006 you had the Grand Jury indict Robert Lawrence on three
counts of tax evasion and three counts of willful failure to file a
personal income tax return.
-
However, on
May 12, 2006, the Friday before the Monday start of the trial, you
suddenly asked federal Judge Michael Mihm to dismiss all six counts
with prejudice.
Indicting and then permanently dismissing without any court action occurs so
rarely as to require the Department of Justice to post a public
explanation in order to satisfy the public’s curiosity about this strange
working of justice. This Foundation decided to investigate the facts and
circumstances of the Lawrence case because we found no such public notice in
Peoria,
on the DOJ website, or in any other public forum. We wanted to determine
the probable cause of DOJ’s remarkable act.
Our
research has led us to conclude that:
- The
DOJ filed the criminal complaint against
Lawrence
because it intended to abuse Lawrence’s rights under the constitution and
law pursuant thereto.
- The
appearance of the Paperwork Reduction Act (PRA) in
Lawrence’s
pleading sent a shock through the DOJ because Congress intended it to
protect the public from IRS abuse, and the DOJ had no defense against it.
-
Even though the DOJ knew about the PRA in advance, its revelation
virtually forced you and the DOJ attorney to dismiss rather than to lose
the case and risk public awareness of the power of the PRA in protecting
the public.
- The
DOJ therefore has little interest in justice in cases it prosecutes for
the IRS, but wants only to obtain wrongful convictions of innocent people
whom the IRS intends to abuse by misapplication of law.
The
Internet and wires were alive with such questions and rumors following DOJ’s
sudden and remarkable dismissal motion that was filed at 2 p.m. on May 12,
2006.
To
determine cause and effect, and put the rumors to rest, we started our
investigation by obtaining
the
Docket Sheet
for
U.S.
v Lawrence, Case
No. 06-cr-10019, U.S. District Court, Central District of Illinois (Peoria).
From
the Docket Sheet we obtained and read copies of the
Indictment and each of the
Lawrence’s
pleadings including:
#04 First
Motion for Bill of Particulars.
#07 Motion for Bill of Particulars
to be directed by the Court.
#08 Motion to Continue April 13th arraignment pending responses to
#04.
#09 Brief re #07 and #08.
#19 Proposed Voir Dire questions
#25
Notice of Expert Witnesses, and opposition to
continuance.
From the Docket Sheet we obtained and read copies of each of the
government’s pleadings, including:
#10 Response
to #4, #7 and #8
#12
Motion for Discovery
#15
Notice of Non-Disclosure
#17
Exhibit List
#18
Motion in Limine
#20
Motion to Continue Trial
#22
Notice of Expert Witnesses
#23
Notice of Filing Expert Resume
#24
Motion for Protective Order
#26
Proposed Voir Dire
#27
Motion to Dismiss with Prejudice Counts 1-6.
We
obtained and read copies of the following documents that were not filed with
the Court but were delivered to DOJ on May 11, 2006 by Lawrence’s attorney
(Oscar Stilley) in response to DOJ’s discovery demands.
[ed.
note: Click here to
access ALL the defense documents
listed immediately below.]
Form 1040 with OMB # 1545-0074 for years 1992
through 2005
Form 1040A with OMB # 1545-0085 for years 1992 through 2004
Form 1040A with OMB # 1545-0074 for year 2005
Form 1040EZ with OMB # 1545-0675 for years 1992 through 2004
Form 1040EZ with OMB # 1545-0074 for year 2005
Form 1040ES with OMB # 1545-0087 for years 1992 through 2005
Form 1040ES with OMB # 1545-0074 for year 2006
Form 2555 with OMB # 1545-0067 for year 2004
Form 2555 with OMB # 1545-0074 for year 2005
Instructions for form 1040 for years 1999, 2000, 2001, 2004, 2005
SF-83 Application for 1986
83-I Application for 1998
We
obtained and read copies of the following court decisions regarding the PRA:
Dole v. United Steelworkers Of America Et Al.,
494
U.S. 26 (1990)
United States v. Collins,
920 F.2d 619 (10th Cir. 1990)
United States v. Dawes,
951 F.2d 1189 (10th Cir. 1991)
Salberg v. United States,
969 F.2d 379 (7th Cir. 1992)
United States v. Wunder,
919 F.2d 34
(6th Cir. 1990)
United States v. Hicks,
947 F.2d 1356
(9th Cir. 1991)
United States v. Hatch,
919 F.2d 1394
(9th Cir. 1990)
United States v. Smith,
866 F.2d 1092;
(9th Cir. 1989)
United States v. Neff,
954 F.2d 698
(11th Cir. 1992)
United States v. Holden,
963 F.2d 1114 (8th Cir. 1992)
49 ADMIN. L. REV. 111,
Paperwork Redux: The (Stronger) Paperwork Reduction Act Of 1995, by Jeffrey S. Lubbers.
47 FR
39515. Notice of proposed rulemaking 5 CFR Part 1320. Office of
Management and Budget, Executive Office of the President. September 8,
1982.
48 FR 13666. Final rule. 5 CFR Part 1320. Office
of Management and Budget, Executive Office of the President. March 31, 1983
52 FR 27768.
Notice of proposed rulemaking. 5 CFR
Part 1320. Office of Management and Budget, Executive Office of the
President. July 23, 1987
53 FR 16618.
Final rule. 5 CFR Part 1320. Office
of Management and Budget, Executive Office of the President. May 10, 1988
60 FR 30441.
Notice of proposed rulemaking. 5 CFR
Part 1320. Office of Management and Budget, Executive Office of the
President. June 8, 1995
60 FR 44981.
Final rule. 5 CFR Part 1320. Office
of Management and Budget, Executive Office of the President. August 29, 1995
44 USCS § 3501. Purpose
44 USCS § 3502. Definitions
44 USCS § 3503.
Office of Information and Regulatory Affairs
44 USCS § 3504.
Authority and functions of Director
44 USCS § 3505.
Assignment of tasks and deadlines
44 USCS § 3506.
Federal agency responsibilities
44 USCS § 3507.
Public information collection activities; submission to
Director; approval and delegation
44 USCS § 3508. Determination of necessity for information; hearing
44 USCS § 3509.
Designation of central collection agency
44 USCS § 3510.
Cooperation of agencies in making information available
44 USCS § 3511. Establishment and operation of Government Information
Locator Service
44 USCS § 3512.
Public protection
44 USCS § 3513.
Director review of agency
activities; reporting; agency
response
44 USCS § 3514. Responsiveness to Congress
44 USCS § 3515.
Administrative powers
44 USCS § 3516. Rules and regulations
44 USCS § 3517.
Consultation with other
agencies and the public
44 USCS § 3518. Effect on existing laws and regulations
44 USCS § 3519. Access to information
44 USCS § 3520. Establishment of task force on
information collection and
dissemination
44 USCS § 3521. Authorization of appropriations
Section 1320.1
Purpose
Section 1320.2
Effect
Section 1320.3
Definitions
Section 1320.4
Coverage
Section 1320.5
General Requirements
Section 1320.6
Public protection
Section 1320.7
Agency head and Senior Official responsibilities
Section 1320.8
Agency collection of information responsibilities
Section 1320.9
Agency certifications for proposed collections of
information
Section 1320.10
Clearance of collections of information, other than
those contained in proposed rules or in current rules
Section 1320.11
Clearance of collections of information in proposed rules
Section 1320.12 Clearance of collections of information in current rules
Section 1320.13 Emergency processing
Section 1320.14
Public access
Section 1320.15
Independent
regulatory agency override authority.
Based
on our review of these documents, we believe the following:
- The
DOJ dismissed the indictment against
Lawrence,
with prejudice,
upon DOJ’s receipt from Lawrence’s attorney (on May 11, the eve of the
trial) of the documents Lawrence intended to enter into evidence.
- The
DOJ was not going to be able to keep the evidence from the jury
because it did not have time to manipulate the Court before the trial
began.
- As
the PRA explicitly authorized him to do,
Lawrence
intended to argue a PRA defense, based on the fact that the IRS form 1040
did not bear a valid control number assigned by the OMB Director
in accordance with the PRA.
- The
DOJ concluded that the jury would acquit
Lawrence
based on his knowledge that the Court could not penalize him for failing
to file a form 1040 because of the invalid control number.
- The
DOJ knew the jury would hear evidence that supported Lawrence, and that
the evidence (the lack of a valid control number on the 1040, and the
absence of other disclosure, use and approval requirements mandated by the
PRA) would destroy the DOJ’s case.
- The
DOJ realized that if the case went to trial, not only the jury, but the
whole body politic would learn that no person has been required to file a
1040 because the form has never displayed a
valid control number assigned by the OMB Director in accordance with
the PRA.
1. IRS has
continually violated PRA Section 3506(c)(1)(B)(iii). The section mandates
that the 1040 form must inform the recipient of:
(I) the reasons the information is being
collected;
(II) the way such information is to be used;
(III) an estimate, to the extent practicable, of
the burden of the collection;
(IV) whether responses to the collection of
information are voluntary, required to obtain a benefit, or mandatory;
and
(V) the fact that an agency may not conduct or
sponsor, and a person is not required to respond to, a 1040 form unless it
displays a valid control number (i.e., issued in accordance with the
requirements of PRA).
2. IRS has
continually violated of PRA Section 3507(a)(1)(C). The section mandates
that the IRS shall not conduct or sponsor the collection of
information via a 1040 unless in advance of the adoption or revision of the
1040 the IRS has submitted to OMB the proposed 1040 form along with
copies of pertinent statutory authority and regulations authorizing the IRS
to collect the information on the 1040 form. The clearance packages that the
IRS submits to the OMB make no mention of IRC Section 1, 61, 63, 6011, 6012,
6091, 7203 or any of the other sections federal judges alternately cite as
“the” authority that authorizes IRS to collect information via the 1040.
3.
The IRS and OMB have continually violated PRA Section 3507(g) and 5
CFR Section 1320.8(b)(1). Those sections mandate that OMB control numbers
must expire after three years, even if the IRS made no changes to its
1040 form during that time. Form 1040 has had the same OMB control number
for 24 years. Under Section 3507(g), every OMB control number must expire
every three years, or sooner. OMB approves a 1040 for only a three year
period so as to ensure that at least once every three years the IRS reviews
the 1040 form, publishes its review in the Federal Register, and seeks
public input. Apparently, the IRS has not submitted a certification to OMB
with an explanation of why it would be inappropriate for OMB to issue a
control number with an expiration date.
4.
The IRS has continually violated PRA Section 3512 ("Public
Protection"). This section prohibits the IRS from penalizing any person for
failing to file a “bootleg” 1040. The 1040 form falls into the “bootleg”
class if it does not display a valid OMB control number and the disclaimer
that no response is required without such a control number. The 1995
amendments strengthened this provision by making clear that IRS victims can
invoke this protection "in the form of a complete defense, bar, or
otherwise at any time during the agency administrative process or judicial
action applicable thereto." In spite of this, the IRS routinely
penalizes and prosecutes people for failing to file the 1040 tax return.
Although required by law, IRS never informs people about the bootleg nature
of the 1040 form, nor the fact that its hapless victims have no legal
obligation to file such bootleg forms.
Section 3512 of the PRA, titled “Public Protection” reads as follows:
(a)
Notwithstanding any other provision of law, no person shall be subject
to any penalty for failing to comply with a collection of information that
is subject to this subchapter [44 USCS § § 3501 et seq.] if--
(1) the
collection of information does not display a valid control number assigned
by the Director in accordance with this subchapter [44 USCS § § 3501
et seq.]; or
(2) the
agency fails to inform the person who is to respond to the collection of
information that such person is not required to respond to the collection of
information unless it displays a valid control number.
(b) The
protection provided by this section may be raised in the form of a complete
defense, bar, or otherwise at any time during the agency administrative
process or judicial action applicable thereto.
Because of the PRA’s Public Protection clause, agencies have an incentive to
make sure that all forms and related regulations bear valid, up-to-date,
prominently legible OMB control numbers.
The instructions for OMB Form 83-I, which the IRS must use in
submitting its request for approval of the 1040 form and an OMB control
number, require each agency to submit with the form a "supporting statement"
which is to "identify any legal or administrative requirements that
necessitate the collection. Attach a copy of the appropriate section of each
statute and regulation mandating or authorizing the collection of
information." The supporting statement must also include information
regarding the "burden" imposed upon the public as a result of the
"collection of information."
Fortunately, Robert Lawrence knew his rights
under the PRA, and DOJ attorneys knew the defense attorney had cornered
them, and that they would not prevail on a Motion In Limine designed
to keep
Lawrence
from effectively arguing a PRA defense. As I have stated, we believe this
caused DOJ to dismiss the indictment against
Lawrence.
As for nearly countless other individuals,
they do not know their Rights or the IRS’s and OMB’s obligations under the
PRA. As a result, the IRS and DOJ conspire at all levels, from senior
executives to the lowliest agents and legal assistants, to prosecute,
penalize, and victimize innocent Americans for failing to file a bootleg
1040, even though their victims have no legal obligation to file
it.
The
Peoria
affair raises serious “abuse of federal power” concerns. We question not
only the actions of IRS and DOJ since 1981, but also OMB’s behavior as it
appears to have willingly looked the other way rather than to require IRS to
fully comply with the Law and to report the IRS’s miscreant negligence to
the U.S. Treasury Secretary and the President.
In addition, various federal judges and their law clerks who
know the legal meaning of the phrase, “Notwithstanding any other provision
of law,” have blatantly ignored the clear and unambiguous meaning of the
provisions of the PRA. Instead of heeding it and advancing its protections
to the aid of IRS victims, they have waged complicit war against the People
for willful failure to file a bootleg 1040 form under any of a variety of
vague, confusing, circuitous, and questionable provisions of the Internal
Revenue Code.
We believe, in accordance with the PRA and the circumstances
of the Lawrence case
dismissal that Americans have no obligation to file bootleg 1040 forms that
are bootleg by virtue of bearing no current, valid OMB control number. We
intend to so inform supporters of our Foundation, members of the We The
People Congress, and of the general public, unless you respond to this
Petition for Redress with some explanation other than the one I have
propounded herein.
If you agree with our analysis, we direct you in the name of
the People of the
United States of America
to order your minions to follow the law to the letter, lest they face
criminal prosecution for violating numerous laws and the Constitution of the
United States of America, not the least of which are their oaths of office.
Accordingly, we expect that you will correct the IRS forms so they bear the
proper OMB control numbers, accurately reflecting the underlining statutory
authority upon which the OMB control number relies pursuant to the
requirements of the Paperwork Reduction Act. Further we demand that you
order IRS employees to immediately stop persecuting those who fail to file
the fraudulent, counterfeit IRS 1040 form.
If we are mistaken in our analysis of the Lawrence case and
its implications for the People of the United States of America who need not
file bootleg IRS forms, please respond to this petition in a timely manner
with a proper and complete explanation of our errors in fact or reasoning
and a correct analysis.
Yours
truly,
___________________
Robert
L. Schulz
Chairman
Cc:
Mr. Rob Portman, Director VIA
CERTIFIED RETURN RECEIPT MAIL
Office of
Management and Budget
725 17th
St., N.W.
Washington,
DC 20503
[end letter]
FOR ADDITIONAL INFORMATION & LEGAL RESEARCH
RELATED TO THE Paperwork Reduction Act:
The Foundation would like to extend many thanks to researcher
Lindsey Springer for his
contributions regarding the PRA
legal research and assistance with the Lawrence case, as well as
defendant Bob Lawrence and his attorney
Oscar Stilley for having
the courage to rely on this research in the manner they did
facing numerous felony income tax charges.
Springer's website featuring his current personal PRA/APA litigation
and his explanatory video can be found be found at
www.PenaltyProtester.com
Please also review the extensive, ground-breaking income tax
legal research (partially PRA related) made available from
our website at no cost by the Foundation in 2004.
The body of work entitled, "Analysis
of the Federal Income Tax Law"
consists of hundreds of legal and historical documents in support
of the argument that the operation and enforcement of the income tax
system is illegal. The research report was included as Attachment #2
of a
Petition for Redress to U.S. Government officials. The
work, authored by attorney Larry Becraft, was the subject
of both state and federal litigation that began in June, 2004 and
ended earlier this year.
Pursuant to the terms of the
settlement agreements in those cases,
the We The People Foundation’s unrestricted rights to copy, publish
and distribute the research was recognized.
Copies of the 400 MB research disk are available on
the
WTP Foundation on-line store for a nominal donation.
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