A self-proclaimed psychic from Hermosa Beach was sentenced Monday to six years in federal prison and his wife received two years behind bars for filing fraudulent tax returns and passing bad checks in an effort to pay of their debts.
Sean David Morton, 59, and his 51-year-old wife Melissa were convicted in April of multiple counts of conspiring to defraud the Internal Revenue Service by passing bogus checks and bonds and conspiring to defraud the United States. As a result of the scheme, the IRS erroneously issued a refund of $480,323 to the couple, prosecutors said.
Sean Morton had been scheduled for sentencing in June, but he failed to show up, leading to a warrant for his arrest. Prosecutors said that while he was at large, he “flagrantly” appeared on social media, his radio program and YouTube to “brag about his status as a fugitive.”
He and his wife were arrested Aug. 21 at a hotel in Desert Hot Springs, where they were watching the solar eclipse.
The charges stemmed from the couple’s participation in a “redemption” scheme, which is used across the nation by tax defiers and so-called “sovereign citizens,” according to the U.S. Attorney’s Office.
Proponents of the scheme falsely claim that the United States government controls bank accounts — often referred to as “U.S. Treasury Direct Accounts” — for U.S. citizens that can be accessed by submitting paperwork with state and federal authorities.
Those promoting the scam frequently cite various discredited legal theories and produce fraudulent financial documents that appear to be legitimate, prosecutors said.
“These defendants orchestrated a scheme that used bogus `legal’ filings that sought to abuse the tax system and defraud the IRS out of millions of dollars,” acting U.S. Attorney Sandra R. Brown said after the Mortons’ four- day trial. “These fraudulent schemes are designed to do only one thing — victimize others for profit.”
The Mortons filed income tax returns with the IRS that falsely claimed they had income from various banks. As part of the scheme, they falsely reported large withholdings and claimed they were owed refunds from the IRS.
On the same day the $480,323 refund was deposited into their joint bank account, the couple took immediate steps to conceal the money, which included opening two new accounts, transferring over $360,000 and withdrawing $70,000 in cash.
When the IRS took steps to collect the erroneous refund, the Mortons began a campaign to thwart the effort. Specifically, when the IRS placed a levy on the couple’s joint bank account, the couple began submitting a shower of bogus documents, instructing the agency to draw upon funds with the U.S. Treasury to satisfy their debt, according to federal prosecutors.
The Mortons also sold the bond scheme to others who were in debt to governmental organizations, such as the IRS and the state of California, and private bank institutions for mortgage or credit card debt, according to the U.S. Attorney’s Office.
The Mortons charged their clients thousands of dollars to prepare and file useless documents declaring their clients’ “strawman” status, and to prepare and send false bonds to the government or banks which purported to pay off the clients’ debt, prosecutors said.
Morton advertises himself as the host of “Strange Universe Radio” on the internet and claims that his psychic skills have received “worldwide recognition.”
–City News Service