The Bel Air business consultant who prepared attorney Lester V. Jones' tax returns in the 1980s has told a federal jury that he "made several mistakes" on them, but he strongly contended that he prepared the returns based on information that Jones gave him.
Ronald A. Dochter, who operates Associated Business Systems, testified as a key government witness yesterday at Jones' tax evasion trial in U.S. District Court in Baltimore. Jones, a former Baltimore County prosecutor and state legislator, is on trial on tax-evasion and false filing charges. He allegedly failed to report nearly $300,000 in income on his 1983 and 1984 tax returns and on amended returns he filed after the Internal Revenue Service began to investigate him.
Dochter said Jones gave him "takeoff sheets," some of them handwritten, which showed the lawyer's income for various years, and said he used those figures to report Jones' income and deductions.
Dochter also said he was "shocked" when an IRS agent who audited Jones' returns discovered massive discrepancies between the lawyer's alleged true income and the much lower income he reported for tax purposes in 1983 and 1984.
The IRS agent "uncovered a sizable amount of income left off the tax returns," Dochter said. "I suggested that Les should get an attorney to deal with a criminal investigation."
Answering questions from prosecutor Joseph L. Evans, Dochter said Jones told him he had "nothing to hide," and agreed to let the consultant and his staff examine his past tax returns in an effort to resolve the discrepancies.
But on cross-examination by defense attorney Stephen H. Sachs, Dochter admitted that he made numerous mistakes in calculating tax deductions on Jones' returns, and admitted that he had given false testimony under oath to IRS agents about his educational background and the information he had from Jones' past tax returns.
Sachs sought to drive home the point to the jury that Dochter engaged in self-serving statements to take the heat off himself during the IRS audit of Jones tax returns.
But Dochter strenuously denied that, claiming he "never had access" to many of the backup documents and other information about Jones' finances that might have flagged discrepancies between the lawyer's reported income and his flamboyant lifestyle, which included condominiums in Ocean City and Palm Beach,Fla., and a collection of expensive cars.
Court adjourned late yesterday, before Sachs' cross-examination tackled Dochter's testimony about Jones' tax returns for 1983 and 1984, the years for which Jones is charged with evading taxes and filing false amended returns.
However, Sachs prompted Dochter to admit that he made several
errors on Jones' returns, including improper deductions for business expenses and mistakes that the defense lawyer referred to as "double counting" of the same figures in different places on the returns.
Dochter acknowledged that he once attributed $10,000 of Jones' law firm income to the defendant's wife and took an improper $500 credit for married couples as a result.