SAN DIEGO — A PSA pilot who earned $273,953 from 1981-83 was arrested for allegedly evading more than $25,000 in state income taxes during that period. State officials said the man claimed that U.S. currency is "counterfeit," so he therefore had no legal money with which to pay his taxes.
The case of Peter W. Sieber Jr., 50, was described by California Franchise Tax Board officials as the largest individual wage-earner evasion case in state history. Sieber was arrested Tuesday at the Pacific Southwest Airlines security offices at Lindbergh Field by fraud investigators of the district attorney's office.
Sieber, a Coronado resident, was charged with three felony counts of tax evasion and bail was set at $10,000. Deputy Dist. Atty. Lantz Lewis said Sieber was arrested on a warrant requested by state officials who set his total obligation at more than $40,000, including interest and penalties.
According to documents filed in the case, Sieber has refused to pay federal and state income taxes because he said filing tax returns violates his constitutional rights, and, he asserted, paying income taxes is strictly a voluntary gesture. Other reasons given by Sieber for not paying taxes include the argument that the "state" referred to in the California Revenue and Taxation Code is not California.
Lewis said that Sieber also alleged that the U.S. currency circulated by the Federal Reserve System is "counterfeit," leaving him no legal tender with which to pay his taxes. Sieber also made "fleeting references" to the Bible and Magna Carta when outlining his reasons for not paying taxes, Lewis said.
Sieber avoided tax withholding by filing an Internal Revenue Service form with PSA claiming that he was exempt from paying taxes, Lewis said.
"Mr. Sieber claimed on the form that because he got a total refund of his federal taxes each year, the company didn't have to withhold taxes from his paycheck," Lewis said. "So, for three years the PSA computer didn't take out any federal or state income taxes from his paycheck."
Sieber could not be reached for comment Wednesday.
In addition to paying the back tax and penalties, Sieber could receive up to three years in state prison and a $20,000 fine if convicted.