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XPost: talk.politics.guns

In article <t0r2i9$2kcv2$43@news.freedyn.de>
forging asshole <governor.swill@gmail.com> wrote:


The mother and son who said they intended to provide low-income
Minnesota families with free computers, Internet access and an
online study guide were convicted Tuesday of defrauding the
Minnesota Department of Revenue of $2.1 million by causing the
filing of false tax returns.

A three-week jury trial in U.S. District Court in Minneapolis
ended with convictions for Carolyn Louper-Morris and her son
William J. Morris Jr., who had owned and operated a business
called CyberStudy.

They were convicted on one count of conspiracy to commit mail
and wire fraud. They also were each convicted of five counts of
wire fraud; Louper-Morris, 63, was convicted of six counts of
mail fraud; Morris was convicted of five counts of mail fraud,
and of filing a false tax return by understating his 2001 income
by more than $400,000.

District Judge John Tunheim allowed the pair to remain free on
bail pending sentencing, which has not been scheduled.
Prosecutor Timothy Rank said the conservative estimate of a
sentence is 14 to 18 1/2 years.

In 2000, when most of the events occurred, Louper-Morris and
Morris operated a business called CyberStudy 101, which sold an
online student tutorial to customers for $1,000 and in return
promised to give customers free Internet access and a computer.

The $1,000 would be paid to CyberStudy by way of a tax credit
available to low-income Minnesotans. CyberStudy filed tax
returns for its customers, directing the tax credit payments to
itself. At the time, Minnesota law provided tax credit for
supplemental educational expenses of $1,000 per child and as
much as $2,000 per family.

During the trial, prosecutors said that CyberStudy didn't make
good on its promises and that its business may have seemed
altruistic for its promise of closing the digital divide, but
the company simply was using the computers to get customers in
the door so they could obtain their state tax credit.

It was a trial likened in its complexity to the Tom Petters case
a few months ago.

Rank, the assistant U.S. attorney who prosecuted the case, also
was co-counsel in the Petters trial. Prosecutors called 49
witnesses and had more than 300 exhibits in the CyberStudy case.

They argued that the online tutorial didn't live up to the
claims CyberStudy made, and that CyberStudy owners had failed in
selling the tutorial to college students for $29.99 before going
the tax credit route. In the two years prior to using state tax
credits, CyberStudy sold fewer than $200 worth of the tutorials.

Prosecutors further showed that in obtaining the tax credits
CyberStudy violated state laws requiring citizens to pay for the
tutorial services before they claim the tax credit on their
returns. More than 2,500 Minnesotans turned over their tax
credit to CyberStudy, prosecutors said.

Neither Louper-Morris nor Morris could be reached for comment
Tuesday. Their conviction comes 10 years after the company's
heyday, when it was lauded for using a tax innovation to help
close the digital divide.

Gregory A. Patterson • 612-673-7287

https://www.startribune.com/mother-and-son-convicted-in- cyberstudy-fraud-case/83406262/

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