Air conditioning exec sentenced to nine years in prison

Thursday, Oct. 30, 1997 | 10:40 a.m.

Las Vegas businessman Lonnie Christensen was sentenced to nine years in prison Wednesday and fined $150,000 after being convicted of tax fraud that may have spanned 20 years.

U.S. District Judge Lloyd George also ordered Christensen and the two companies he ran, World Air Conditioning and M.J. Wood & Associates Inc., to make restitution totaling $3.8 million to the Internal Revenue Service and the Nevada Department of Taxation.

Prosecutors argued during the sentencing hearing, which began in federal court Tuesday and ended Wednesday, that Christensen used tax fraud to lead a lavish lifestyle.

Christensen was found guilty in December 1995 of cheating the Internal Revenue Service and Nevada out of more than $3 million.

Assistant U.S. Attorney Eric Lisann said Christensen perpetrated the biggest tax fraud in Nevada history and was one of the largest cases brought by the government against a private individual in the United States.

Christensen will spend a little more than 100 months in prison. A probation investigator recommended between 97 and 121 months.

He was convicted of conspiring to defraud the federal government and six counts of filing false income tax returns for himself and his companies. Christensen also was found guilty of two counts of obstructing justice through the falsification and hiding of tax records and one count of wire fraud in connection with evasion of paying state sales and use taxes.

From 1972 to 1994, Christensen did not pay an estimated $1.4 million in state taxes, and from 1986 to 1990 he failed to pay $2.2 million in federal taxes.

Christensen took over M.J. Wood & Associates from his former father-in-law and became a sophisticated and excellent salesman, the government said. Although he did not have a college degree, Christensen had a tremendous understanding of the business world and used it to his advantage.

M.J. Wood & Associates and World Air Conditioning held contracts with A.G. Spanos Construction Inc., one of the nation's largest residential developers, and installed the heating, ventilation and air-conditioning systems in the MGM Grand hotel-casino and the Spanish Trail subdivision.

Part of Christensen's defense during a three-week trial was that much of what the government alleged were unlawfully deducted personal expenses were actually business expenses used to entertain Alex Spanos, owner of the San Diego Chargers football team.

Goodman argued that his client was an honest businessman and was being targeted for his lifestyle, which, according to testimony, included supporting a wife and girlfriend.