Thursday, April 15, 2004 | 8:59 a.m.
Irwin Schiff, a 76-year-old Las Vegas man who claims that there is no law enforcing the payment of federal income tax, will represent himself in criminal proceedings in which he is alleged to have evaded taxes and helped hundreds of people to file false tax returns.
Schiff appeared before U.S. Magistrate Peggy Leen Wednesday to be arraigned and to enter a plea to a 33-count federal indictment. After a 75-minute hearing that included continual interruptions from Schiff, Leen entered a plea of not guilty for him. Although Leen cautioned him against it, she agreed to allow Schiff to represent himself.
Schiff, who was indicted in March, is scheduled to go to trial June 21 in front of U.S. District Judge Kent Dawson.
Schiff and his co-defendants, Cynthia Neun, 50, and Lawrence N. Cohen, 63, told Leen that they understood the words in the indictment but did not understand how or why they were being charged with crimes.
"It's confusing and inconsistent," Schiff said of the indictment. "I understand that the government has an illegal and erroneous position.
"All they have to do is show me the law in the tax code that says I have to pay taxes, and I'll plead guilty and save the court's time."
Cohen, who was represented by attorney Chad Bowers, refused to make a plea. Leen entered a plea of not guilty for him. Neun could not decide whether she wanted to hire an attorney, have the court appoint an attorney or represent herself in the case, and Leen delayed her arraignment until Friday to give her a chance to decide.
The government alleges that Schiff, who sells anti-tax books and materials at his East Sahara Avenue bookstore, Freedom Books, has been running a tax scam that has cost the government an estimated $56 million.
According to the indictment Schiff, Neun and Cohen, all of Las Vegas, conspired to file and cause others to file fraudulent tax returns, including more than 4,950 tax returns fraudulently reporting no income.
The Justice Department alleges that Schiff, Neun and Cohen, through consulting, seminars, books, audiotapes and Web sites, help people file "zero-income" tax returns, even though these people have taxable income. The government alleges that Schiff has been selling his materials online and at his store, providing step-by-step instructions for filling out income-tax returns falsely listing no income and no tax due.
Leen patiently questioned Schiff to determine if he was able to represent himself in the case, often having to steer Schiff away from making arguments on the merits of the case against him.
At one point she asked Schiff if he had studied law. Schiff, who said he is a graduate of the University of Connecticut, said he had taken some classes.
"I got A's at UConn. You know we just won the basketball championship," Schiff said.
Schiff added: "Look, Lincoln never went to law school and he was still a pretty good lawyer."
If convicted, Schiff faces a maximum sentence of 43 years in prison and $3.25 million in fines. Neun faces 51 years in prison and $3.4 million in fines. Cohen could receive a maximum of 27 years in prison and $1.5 million in fines.
All three defendants were released on personal recognizance, but the government asked that Schiff turn over his passport because he has money in offshore accounts. Schiff did not oppose the motion, so Leen added it as a condition of his release.
"I wouldn't miss this trial for the world," Schiff said. "The government fell into my trap by indicting me. Wild horses couldn't keep me away."
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