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Dominelli's Attorney Guilty in Tax Case

June 07, 1985|BILL RITTER | San Diego County Business Editor

D. Gilbert Athay, the criminal defense attorney representing J. David (Jerry) Dominelli, on Thursday pleaded guilty in Salt Lake City to two misdemeanor counts of failing to file federal income tax returns.

Athay will be sentenced July 11 and faces as much as two years in prison and fines of up to $20,000.

Athay was indicted in April on three counts of not filing tax returns in 1978, 1979 and 1980. His guilty plea deals only with 1979 and 1980; the remaining charge was dropped.

Prosecutors on Thursday said that had the case gone to trial they were prepared to show that Athay had not filed state or federal income tax returns for six years.

The indictment alleged that Athay had income of $44,403 in 1978, $53,739 in 1979 and $78,285 in 1980, but had filed no federal income tax returns in any of those years.

Athay could not be reached for comment.

However, Max Wheeler, Athay's attorney, said that the case "wasn't quite as straightforward as the prosecutor" implied.

During the tax years included in the indictment, Athay was in the process of a divorce and "his records got mixed up," said Wheeler. "His accountant never got the returns together."

Wheeler said he doesn't expect Athay to draw a prison sentence because "no one has done jail time in Utah for failing to file income tax returns in the past six or seven years."

In March, Athay helped draft a plea bargain agreement for Dominelli, the founder of the fraud-ridden J. David & Co. investment firm. One of the four federal felonies included in Dominelli's admission was tax evasion for failing to pay more than $10 million in federal income taxes in 1982.

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