6 1/2-Year Sentence In Tax Scandal

Md. Man Is Nephew Of Ex-D.C. Manager

The first defendant to plead guilty in the D.C. tax office scandal was sentenced yesterday to 6 1/2 years in prison for conspiracy to commit money laundering and possession of stolen property.

Ricardo Walters, a nephew of the scheme's alleged mastermind, was the first person to be sentenced in connection with the tax office embezzlement scam, which goes back almost 20 years and which prosecutors said yesterday cost the city at least $48 million.

In court yesterday, one of the prosecutors, Assistant U.S. Attorney Jonathan C. Su, called the crime an embezzlement of "massive proportions" and revealed that 12 days after Walters was charged in November, he tried to stash $150,000 of the scheme's proceeds in a newly opened account at a SunTrust bank.

Walters, 33, had faced far more prison time than he was given. U.S. District Judge Alexander Williams Jr. said he went along reluctantly with the prosecutors' recommendation of a 6 1/2 -year term.

"This was a horrible scheme," Williams said. "Candidly, it's shocking and shameful."

He rejected a request that Walters be allowed to settle his affairs and visit a son in North Carolina before surrendering and ordered him locked up immediately.

Under the law, Walters had faced up to 10 years for possession of stolen property and up to 20 years for conspiracy to commit money laundering. Under federal sentencing guidelines, he had faced a recommended range of slightly more than 5 1/2 years to slightly less than 7 1/2 years.

Why, Williams asked the prosecutors in court, shouldn't Walters be given the longest sentence under the guidelines?

Su said that Walters had agreed not to contest a number of issues in the sentencing process and that, as a result, both sides had been able to agree on a recommended term.

Standing before the judge for a few moments, Walters apologized to the people of the District and Maryland for what he had done.

Walters, of Fort Washington, has been cooperating with prosecutors. The agreement with the government had one critical caveat: Walters would not testify against his aunt, Harriette Walters, the former D.C. tax office manager at the center of the investigation.

It was she who allegedly set in motion the scheme in which fraudulent property tax refunds were issued to her friends and cohorts, who allegedly kicked back a share of the money. Walters has been jailed since her arrest in the fall and is awaiting trial.