By Henri E. Cauvin
Washington Post Staff Writer
Wednesday, November 5, 2008
A Bowie man who used his plumbing business to help his sister carry out a huge D.C. tax refund scam was sentenced yesterday to four years and three months in prison.
Richard Walters, 49, whose older sister, Harriette Walters, was the mastermind of an embezzlement scheme that cost the D.C. government about $48 million, cashed $4.9 million in illegal refund checks that were issued from 2001 to 2007.
Appearing yesterday in federal court in Greenbelt, Richard Walters was the first of six cooperating defendants to be sentenced by U.S. District Judge Alexander Williams Jr., who is handling those charged in Maryland in connection with the fraud.
Under federal sentencing guidelines, which are advisory, Walters had faced 46 to 57 months in prison. His attorneys, David Greenbaum and Steven Freeman, asked for a term at the low end of the guidelines, emphasizing his prompt and complete cooperation. "It is our belief that no one cooperated as quickly or as fully as Mr. Walters did," Freeman told the judge.
Assistant U.S. Attorney Jonathan Su, one of the prosecutors, sought a sentence of 55 months. Although acknowledging the assistance provided by Richard Walters, Su noted that Walters had engaged in serious criminal conduct and that he had used his share of the money to buy a Bentley, Washington Wizards season tickets and other high-end items.
Given the chance to address the court, Walters said: "I would like to formally apologize to the District of Columbia and the State of Maryland for my complete lack of judgment. . . . I hold myself completely responsible."
A few moments later, as he told the court he was "very sorry," he lowered his head and began to whimper. One of his attorneys put a hand on his shoulder. The other reached for a box of tissues on the table.
"I'm a good person," Walters said after pulling himself together.
Richard Walters is one of 11 people to plead guilty to charges stemming from the embezzlement. His sister, who pleaded guilty in September, was a mid-level manager in the D.C. Office of Tax and Revenue. She figured out a way to steer phony property tax refunds to friends and relatives in a scam that lasted nearly 20 years. She has been jailed since her arrest a year ago and awaits sentencing.
Richard Walters's company, Helmet Plumbing, was one of the vehicles for carrying out the massive fraud. Of the $4.9 million in illegal property tax refunds handled by his company, more than $1 million of the money went to accounts he controlled. He pleaded guilty in May to receipt of stolen property and conspiracy to commit money laundering.
As part of his sentence, a forfeiture order of almost $4.9 million was imposed on him. As a result, he must surrender a home in the Virgin Island, two homes in Bowie, a 2005 Bentley, four other vehicles, jewelry and money held in several bank accounts.
The judge has expressed outrage over the scope and audacity of the fraud perpetrated against the District, and yesterday he reiterated those sentiments. "I can't think of anything more bold than what has happened here," Williams said.
He was more charitable in his characterization of Richard Walters. "You're not a bad guy. It's just that greed got in the way," he said.
But in a case of such magnitude, a slap on the hand would not suffice, Williams said. Given Walters's cooperation, a sentence in the middle of the guideline range would be appropriate, said Williams, who agreed to permit Walters to report for sentencing after the U.S. Bureau of Prisons determines where he will go.
Had he not cooperated, Walters would have almost certainly faced a longer sentence. His nephew, Ricardo Walters, who was the first to plead guilty in the case, did not cooperate fully with investigators. He was sentenced to 6 1/2 years.