Even Former NBA and NFL Stars Can Face Tax Evasion and Fraud Charges

For former pro athletes, dominance on the court or on the gridiron can impart a lifelong sense of invulnerability. Some former stars may feel that, as on the court or field, the rules do not apply to them and they can take additional liberties that would result in criminal charges for other individuals. At least, this is a story the state and federal prosecutors have found that juries will accept and use as part of their decision-making process when rendering a guilty verdict.

Whether these types of allegations are true surely varies on a case-by-case basis. However, pro athletes must understand that their dominance in sports may not provide the goodwill and insulation from criminal charges they would expect. Rather, as this list of convicted athletes makes clear, status as a pro athlete does little to protect and the increased publicity and public exposure may even increase the odds of prosecution for alleged crimes. Criminal convictions of pro athletes include mail and wire fraud, bribery, money laundering, tax evasion, along with an array of other serious offenses.

Hall of Fame Ex-Charger Ron Mix Pleads Guilty to Tax Evasion

Ron Mix lived the American dream – twice. First, he was a Hall of Fame tackle for the San Diego Chargers and the Oakland Raiders. Then, after retiring from professional football, Mix became a highly successful workers’ compensation lawyer. Most of Mix’s work involved representing former professional athletes who made claims due to severe, life-altering injuries suffered during their playing days. However, it is from these representations that Mix’s and Kermit Washington’s troubles began.

As it turns out, some of the athletes represented by Mix were referred through a non-lawyer, Kermit Washington. In exchange for the referrals, Mix agreed to make a donation to a charity known as Project Contact Africa. From 2010 to 2013, Mix donated more than $150,000 to the charity. However, an investigation into software piracy eventually discovered connections to the charity. Further investigations into the charity revealed it to be a fraud. Mix was not implicated in the software piracy scam and maintains that he believed that the charity was legitimate – a fact that is echoed in his plea agreement.

However, Mix’s tax fraud guilty plea stems from the fact that he claimed charitable deductions of $40,000 on his 2012 taxes. When making a charitable deduction, one is not permitted to receive something of value for the deduction. Since Mix received client referrals in exchange for the donations, the deductions were fraudulent. Mix could serve up to three years in prison and a $250,000 fine for this conduct. Furthermore, he has already agreed to pay back $49,543 to the IRS.

Kermit Washington Arrested in Los Angeles for Alleged Charity and Tax Fraud Scheme

The fraudulent charity, Project Contact Africa, was run by another famous pro athlete, former Trailblazers and Los Angeles Lakers power forward Kermit Washington. This charity and another allegedly fraudulent charity, The 6th Man Foundation, are at the center of charges surrounding Washington. Regarding the prosecution risk faced by former professional athletes, it is important to note that U.S. Attorney Tammy Dickinson emphasized that, “The federal indictment alleges this former NBA player used his celebrity status to exploit the good intentions of those who donated to a charity he founded…”

The alleged fraud committed by Washington took two main forms. First, he allegedly used donations made by individuals, like Mix, intended to benefit a clinic in Africa for his own personal enrichment. Second, prosecutors also allege that Washington conspired with others to use the charity’s tax-exempt status to avoid listing and other fees to defraud Paypal and Ebay.

Washington was indicted on four counts by a federal grand jury. Washington was arrested in Los Angeles on Tuesday, May 31, 2016. He was released on $75,000 bond.

The charges against Washington are corrupt interference with the internal revenue laws, conspiring to commit wire fraud, obstruction and aggravated identity theft. Washington faces allegations that he filed false income tax returns for tax years 2010 through 2013. Washington faces a potential combined prison sentence of over 40 years. For the corrupt interference with the internal revenue laws charge, he could face up to a three-year prison sentence. For the conspiracy to commit wire fraud charges, Washington could face up to a 20-year prison sentence. For the obstruction charges, Washington could also face up to 20-years in prison. The identity theft charge could result in up to an additional two-year prison sentence. Substantial monetary fines can also be imposed for all of these charges.