It appears the closing arguments in the tax evasion case against Mobile County License Commissioner Kim Hastie and her husband gave jurors a lot to think about, as four hours of deliberation wasn’t enough to render a verdict on Thursday.
Jurors are expected to report to court for the fourth strait day on Friday morning and attempt to reach a final decision. If convicted, Hastie would be immediately removed from office, prompting any number of temporary solutions before a replacement could be appointed by Gov. Robert Bentley.
In their closing arguments, defense attorneys representing Hastie and her husband, John Melvin Hastie Jr., said there would need to have been “a meeting of the minds” between the couple in to order back up the federal government’s claim the Hasties conspired to hide income from the IRS.
In his closing arguments, Assistant U.S. Attorney Sinan Kalayoglu did his best to show those links through bank accounts controlled by the Hasties, one of which was used to pay for the construction of the couple’s $600,000 home.
“Kim Hastie was actively involved in building her ‘dream home,’ Kalayoglu said. “There was a $20,000 deposit in their (contractor’s) account because they needed an infusion of cash.”
The prosecutor was referring to the first of two payments Hastie Jr. received for organizing a land deal in 2009. Those proceeds were never disclosed to the IRS prior to the couple’s indictment, but defense attorneys claimed during the trial Hastie never knew about the money or the land transaction.
Kalayoglu pointed to the multiple checks for construction costs Hastie signed as proof she “had to know about the money.” Based on information from the same tax year, the $38,400 Hastie Jr. received would have been equal to 25 percent the couple’s combined total income.
As salaried employees receiving direct deposits each month, the prosecutors surmised Hastie “logically had to have known about additional deposits of $20,000 and $18,400.”
Wrapping up his statements to the jury, Kalayoglu pointed to the couple’s almost immediate spending following the deposits as evidence of that knowledge.
“How can you spend money you don’t know about?” Kalayoglu asked the jurors. “Has there been evidence John Hastie sought to conceal income from his wife? There hasn’t.”
The defense took a little more long-winded approach. Attorney Jeff Deen told jurors they weren’t being asked to determine if John Hastie failed to pay his taxes or “even if he didn’t intentionally pay his taxes.” He said the government was tasked with proving there was a conscience agreement to defraud the United States.
Deen also pointed out three of the five sources of income the government scrutinized occurred in 2014, and weren’t required to be disclosed at the time the indictment was issued in January of the following year. A CPA employed by Deen helped the Hasties get an extension filed to their 2014 taxes, which now won’t be due until October.
Neil Hanley, who’s representing Hastie, referred to the case as “classic misdirection, mischaracterization and government overreach.” He implored the jury to stop a precedent he said could lead to the government “picking and choosing who they want to indict for taxes that aren’t yet owed.”
“This is scary stuff,” he said.
Hanley questioned the prosecution’s theory that the scheme would have been concocted to support a lavish lifestyle. He and Deen both said the government has gone out of its way to make ordinary purchases look “sinister.”
“The prosecution said this was about greed and a luxurious lifestyle. Where are the luxuries?” Hanley asked the jury. “They paid the mortgage and paid to educate their children.”
In their counter arguments, prosecutors compared filing the indictment before tax season to catching a bank robber in the act. Kalayoglu pointed to the similar nature of the split payments to Hastie Jr. 2009 and in 2014 and again claimed the evidence shows the behavior of both parties to be indicative of a “thought-out and willful scheme.”
Because the government has the burden of proof, prosecutors addressed the jury last. Assistant U.S. Attorney Gregory Bordenkircher downplayed Hanley’s statements about the purchases discussed in the trial.
“There’s nothing wrong with paying tuition for your children or paying for condos or getting cash,” Bordenkircher said. “You can have a $600,000 house, just don’t cheat the government on your taxes and become a hypocrite.”
According to Bordenkircher, he used the term hypocrite because of Kim Hastie’s position overseeing the License Commission, which collects and assess taxes for the county. He told the jury Hastie had received emails at work about the construction of the house she partially financed with the money her husband failed to properly disclose to the IRS “all while on the dole for (taxpayers).”
“She’s the one collecting y’all’s taxes, but she chose to live above the law,” Bordenkircher said bringing testimony to a close. “Don’t let her be above the law.”
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