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Tag: tax evasion

The Taxman Cometh: U.S. v. Alphonse Capone

Al Capone—the quintessential American gangster—headed the nation’s most notorious organized crime syndicate for more than a decade during Prohibition.

Through smuggling, bootlegging, and a variety of other criminal operations, his “Chicago Outfit” was able to dominate America’s illegal liquor trade throughout the 1920s. But did you know that Al Capone was never convicted of violating the National Prohibition Act?

In 1931, Capone was indicted for income tax evasion for 1925-1929. Despite his immense wealth, he had never paid taxes or purchased any assets in his own name.

So when the Internal Revenue Service’s Special Intelligence Unit uncovered cash receipts from a gambling operation linked to Capone, the evidence served as the foundation for a Federal case. The prosecution charged that he owed over $200,000 in unpaid taxes stemming from gambling profits.

Unable to strike a plea bargain with prosecutors, Capone attempted to bribe jury members. The presiding judge, however, responded by quietly changing the jury panel prior to the trial.

On October 18, 1931, Capone was found guilty on five counts of tax evasion. A month later he was sentenced to 11 years in Federal prison, fined $50,000, charged $7,692 for court costs, and ordered to pay his back taxes plus interest.

Following seven and a half years in prison (four and a half spent on Alcatraz), Al Capone was released in 1939. His incarceration … [ Read all ]