The Justice Department scored a major victory yesterday in its controversial investigation into off-shore tax havens and money laundering when a Las Vegas man believed to have intimate knowledge of several tax evasion schemes agreed to cooperate with the government probe.
Leonard Rosen, a Las Vegas land developer, who had been under investigation in connection with several land fraud and international finance schemes, pleaded nolo contendere to a federal tax fraud charge. His agreement to help investigators for "Project Haven," a joint Justice-Internal Revenue Service probe, may save that beleaguered investigation.
"Project Haven" is a decade-long investigation into the alleged use of off-shore tax havens by wealthy Americans seeking to evade U.S. tax payments.
The investigation has centered on Castle Bank & Trust in the Bahamas and Cayman Islands, as well as Chicago tax lawyer Burton Kanter, who investigators believe may have used the bank to set up many schemes for his prominent clients.
Rosen was one of dozens of clients or former clients of Kanter to come under investigation One partner in Kanter's film, Roger Baskes, was recently sentenced to two years in jail for his part in a Reno, Nevada, apartment building sale that had been laundered through an off-shore bank to reduce the tax bite on the purchaser. Kanter was exonerated in that same case.
Project Haven attorneys did not file charges against Rosen. But an IRS revenue agent auditing the books of Preferred Equities Corp., a Las Vegas land concern Rosen is involved in, discovered that he had not reported to the IRS the sale of two parcels of land valued at more than $5.5 million. He pleaded nolo contendere to that charge in Los Vegas yesterday.
But Rosen may be of value in another Project Haven investigation which was halted earlier for lack of evidence.
Government probers had been investigating a possible Las Vegas money-laundering scheme in which couriers carried out of the country huge amounts of money reportedly skimmed from the coffers of some of the bigger Nevada gambling casinos.
Sources close to the investigation say, the money then would come back into the country through an off-shore bank. A foreign national would make a gift of the money to an American who had been involved in the scheme.
Because the money was given through the Nassau-based bank, the source could not be untraced due to bank secrecy laws on that island.
Justice Department officials in Washington were exuberant over Rosen's plea-bargaining arrangement.