Craig Taffaro was friends with wealthy businessmen, famous movie stars and Hollywood producers. He rose to the highest ranks of Louisiana law enforcement and earned the esteem of his colleagues.
Yet there was a dark side to the longtime lawman, federal prosecutors said as they closed their case against the former Jefferson Parish Sheriff’s Office chief deputy on Friday. While Taffaro may have spent much of his time working on behalf of a charity for children with cancer, they said, he also cheated on his taxes for years.
“Sometimes you don’t know every side of a person. And the evidence shows exactly what he did,” Assistant U.S. Attorney Chandra Menon said.
The prosecution and defense closed their cases Friday, the fifth day of Taffaro’s trial on six counts of tax evasion, five counts of filing a false tax return and one count of failing to file a tax return.
Taffaro, 70, is accused of claiming almost $200,000 in fake expenses in connection with a side business he co-owned with former Sheriff Newell Normand. The two-man firm called CTNN brokered grocery sales from Pelican Marine, a company once co-owned by Lt. Gov Billy Nungesser, to Harvey Gulf, run and partly owned by prominent businessman Shane Guidry.
When the jury returns to the courtroom of U.S. District Judge Martin Feldman on Monday, they will deliberate on Menon’s arguments and those of Taffaro’s defense attorney, Michael Magner.
Magner said the case isn’t about the greedy, Jekyll-and-Hyde-like figure the government presented. Instead, he argued that it’s about a gang of overzealous federal agents who tried and failed to catch bigger fish, and so turned their attention to Taffaro instead.
As an Internal Revenue Service Agent testified Wednesday, the investigation began with an anonymous tip. Magner said that the tipster named Normand and Nungesser.
“Some person — who knows if it was an enemy of Mr. Nungesser, if it was an enemy of Mr. Normand — made an anonymous tip,” Magner said.
Nungesser, who is Taffaro’s son-in-law, was in the courtroom sitting with the defendant’s family on Friday. He called it “obvious” that the case started out as an attempt to target him and Normand.
“I don’t feel this is right,” Nungesser said after the closing statements. “If they put a team of people like that on everybody that had a tax problem, we’d never catch criminals.”
Magner said that when the tip didn’t pan out, agents turned their attention to an “audit on steroids” of Taffaro. The defense lawyer said those investigators zealously continued their hunt despite signs that Taffaro was an honest man and that all of his claimed expenses were necessary for his several side businesses.
Taffaro testified over two days this week that he tried to keep receipts for his numerous expenses. But some were lost with an iPad on an airplane and others were shredded when he retired from the Sheriff’s Office last year, he said.
Magner said that while his client may have been “sloppy” — especially after 2009 open-heart surgery — he was never a cheat. He also implied that he might have received bad advice from his longtime accountant, Pat Sharp.
Many of Taffaro’s expenses claimed in connection with CTNN should have been tallied up to his other side ventures, such as consulting to the film industry or serving on the board of Sunshine Kids, the cancer charity, Magner said.
“It was up to Mr. Sharp to fit those things into various buckets on the tax return,” Magner said. “(Taffaro) relied on Pat to put them into the right place on the returns.”
Rather than just one man’s tax foibles, Magner presented the case against his client in larger terms. With his voice rising to a crescendo, he said the government’s quest to convict his client was a sign of larger ills.
“If your government can do that to this man, what can they do to you?” Magner said. “If the government has the power to put 10 to 12 agents with a microscope on this man and abuse its power, what do we have left? What has this country come to?”
Menon, the prosecutor, said the case was about narrower and more personal problems. He listed the expenses that Taffaro had claimed over the years in which he is charged with tax crimes, from 2009 to 2014.
There was the handful of guns which Taffaro claimed as expenses for his Sheriff’s Office work, but which he never qualified for on the shooting range, Menon said. There was the free flight to a law enforcement conference he got from his friend and business associate Guidry, for which he sought reimbursement from the Sheriff’s Office. There was also the Toyota SUV in which he said he drove 14,000 miles for CTNN work — but which had only 12,000 miles on it when it was sold.
Menon said Taffaro lucked out when Pelican Marine agreed to give him a 10 percent cut of its sales to Harvey Gulf. He repeated Internal Revenue Service Special Agent Tim Moore’s assertion that Taffaro and Normand arranged a “no work” contract.
“The defendant got an amazing deal,” Menon said. “But that wasn’t enough. He had to cheat on his taxes, too.”
Federal prosecutors also suggested repeatedly throughout the trial that Taffaro had a gambling problem that could have led him to lie on his tax returns to offset his losses. They said bank records show he withdrew $297,000 in cash at casinos between 2009 and 2014, the years in which he is accused of dodging taxes.
Magner argued that the gaming and the tax returns were unrelated. "If that's his hobby, that's his hobby," the attorney said.
Earlier Friday, Menon grilled Taffaro for 2½ hours. Taffaro took the stand in his own defense on Thursday, and the questioning continued with cross-examination Friday.
Menon asked Taffaro question after question about why he was late filing or paying taxes — in one instance 34 months late — and why he lacked documentation for tens of thousands of dollars in claimed expenses.
The former lawman seemed to blame Sharp, his tax preparer, for miscategorizing some expenses. Menon pressed Taffaro on whether the flawed tax returns were Sharp’s fault.
“They were placed by him. I don’t want to say fault,” Taffaro said.
Taffaro said that since his indictment in July, he has tried to make sense of the tax forms that landed him in so much trouble.
“Since this case has gone, I’ve read my tax returns, and I can’t make hide nor hair of it,” Taffaro said.