04/24/2006

By EMERY P. DALESIO  / Associated Press

A couple accused of running an offshore tax-fraud scheme from the Bahamas with the help of a former head of the state Republican Party should be held without bond until trial, a judge ordered Monday.

Federal prosecutors asked Judge W. Earl Britt to keep Howell and Vernice Woltz in jail because they have significant undeclared assets and have moved their primary home to the Bahamas. They are also key figures in a separate international money-laundering case, prosecutors said.

"This is just the tip of the iceberg of an international money-laundering investigation," assistant U.S. attorney Kurt Meyers said. "Millions, literally tens of millions, of dollars are involved in money laundering. It provides an incredible incentive for these defendants to flee."

For example, the Woltzes offered customers a type of credit card that lacked the raised lettering that make the cards traceable, prosecutors said. Transactions using the cards were cleared through a bank in the Netherlands Antilles, Meyers said, making the card an attractive way to move money into the United States without attracting much notice.

In a court filing Friday, Meyers said the Woltzes tried to interest an undercover Internal Revenue Service agent in "an offshore credit card whose primary purpose was to allow U.S. citizens to take money offshore undetected by the government and to use the card without being tracked."

The Woltzes are charged with two counts of obstruction and conspiracy to obstruct a lawsuit brought by the Commodities Futures Trading Commission. Howell Woltz also is charged with tax conspiracy and perjury. Vernice Woltz also is charged with concealing documents.

"The evidence in this case is strong," said Judge W. Earl Britt as he overturned a decision last week by a federal magistrate in Charlotte to release the Woltzes into the custody of his family in Surry County.

The Bahamas does not recognize tax fraud charges and would not extradite the Woltzes to the United States to face trial if the couple returned there, Meyers told Britt. The couple planned to cut their U.S ties when the sale of their home and farm in Advance closed in June, prosecutors said.

The Woltzes were charged in a federal indictment unsealed last week in Charlotte. Wilmington tax attorney Ricky Graves and Raleigh attorney Sam Currin were also charged in the case after a three-year undercover IRS investigation.

Currin was formerly an aide to Sen. Jesse Helms; the United States attorney for eastern North Carolina from 1981 to 1987; and a Superior Court judge until 1990. Since then, he has represented criminal defendants in the state's federal courts. From 1996 to 1999, he served as chairman of the state GOP.

Howell Woltz was the president of Sterling Trust, a financial services company based in the Bahamas and the British West Indies the U.S. government claims set up financial entities to hide the assets of wealthy Americans. Vernice Woltz and Currin were directors of the related Sterling Bank, based on the island of St. Lucia, prosecutors said.

Currin and Howell Woltz had a financial falling out late last year and since then have each approached federal prosecutors offering to provide evidence in an ongoing investigation, U.S. attorney Matthew Martens said.

Currin and Graves were released last week on $100,000 bond. Prosecutors had not opposed Currin's release in part because he was immediately admitted to a medical facility and was under supervision there, Martens said. He did not specify Currin's ailment.

Currin, Graves, and Howell Woltz were charged with tax fraud conspiracy for preparing "false and fraudulent documents to deceive the IRS," the indictment said.

Currin, 57, also was charged with obstruction of justice, witness tampering, and perjury in a related grand jury investigation of securities fraud. Currin not only gave false testimony, he persuaded Raleigh attorney Robert Wellons to "make false and misleading statements to and withhold documents from the grand jury," the indictment said.

Wellons, 37, pleaded guilty to conspiracy to obstruct justice and has agreed to help the government, prosecutors said. He faces up to five years imprisonment, prosecutors said.

If convicted on all charges, Currin faces up to 60 years in prison, prosecutors said. Howell Woltz faces a maximum of 65 years, Vernice Woltz 55 years, and Graves eight years.