Herbal remedy magnate Almon Glenn Braswell, who received a controversial pardon from President Clinton for a 1983 fraud and perjury conviction, has been arrested on new charges of evading more than $13.4 million in income taxes, federal prosecutors in Los Angeles said Tuesday.
Braswell, owner of Marina del Rey-based Gero Vita International Inc., was named in a 13-count indictment returned by a federal grand jury late last year and kept secret until his arrest Monday in Miami Beach. The 59-year-old Braswell, who spent seven months in prison for his earlier conviction, was pardoned Jan. 20, 2001, the day Clinton's presidency ended. It was later disclosed that Braswell had paid Clinton's brother-in-law, Hugh Rodham, $200,000 to lobby the White House for his pardon.
Clinton and his wife, Hillary, denied any knowledge of the payment. They demanded that Rodham return the money, along with another $200,000 he received to lobby for a commutation for convicted drug dealer Carlos Vignali, whose father was active in Los Angeles political circles.
The investigation that led to Braswell's indictment was launched by the Internal Revenue Service a full two years before he received his presidential pardon, one of 140 issued by Clinton in the closing days of his administration. A Clinton spokesman said the pardon was specifically for the 1983 conviction and not for any charges that might stem from ongoing criminal investigations.
The new indictment accuses Braswell of setting up a shell company in Bermuda that he used to pad expenses incurred by Gero Vita. He is also charged with using personal accounts in Bermuda to hide millions of dollars in personal assets.
Also indicted in the case were William E. Frantz, 64, a tax attorney from Marietta, Ga., and Robert B. Miller, 45, a certified public accountant from Canyon Country. They were accused of conspiring to help Braswell and his company evade tax payments. The U.S. attorney's office said Frantz and Miller will be allowed to surrender to federal authorities in Los Angeles. Braswell is being held pending a detention hearing Friday in Miami.
Braswell's lawyers did not return phone calls seeking comment.
Miller's attorney, Mark C. Holscher, said his client "provided entirely appropriate and legitimate services to Gero Vita, which paid several million dollars a year in taxes for each of the years in question." But Holscher said Miller is in no position to stand trial, having been left severely disabled by an aneurysm last year that triggered two heart attacks, a stroke, kidney and liver failure, a monthlong coma, and paralysis in his hands and feet.
Frantz's lawyer, Tom Pollack, said, "There is substantial evidence to contradict the charges in the indictment, and we fully expect that Mr. Frantz will be exonerated at trial."
The indictment alleges that Braswell evaded paying more than $9 million in personal income taxes from 1994 through 1997 by transferring money into a bank account that Frantz's law firm maintained in Atlanta. The funds were then diverted into personal accounts that Braswell controlled in Bermuda, according to the indictment.
Prosecutors say the corporate tax evasion scheme involved the issuance of bogus invoices to Gero Vita by a Bermuda shell company that Braswell owned, DeLeon Global Trading Ltd. Among other things, the indictment contends that Miller, the certified public accountant, created phony billings purporting to show that Gero Vita had purchased millions of dollars worth of nutritional supplements and health-care products from the Bermuda firm.
Miller was also accused of preparing a fraudulent tax return for Gero Vita. All told, the indictment alleged, Braswell evaded payment of about $4.4 million in corporate taxes.
Controversy has dogged Braswell for years. The Food and Drug Administration ordered some of his products seized as potentially dangerous. The Federal Trade Commission barred him from promising that one of his products would cure baldness. The U.S. Postal Service has filed numerous complaints against him for false representation in direct-mail solicitations. And the Council of Better Business Bureaus accused him of hyping claims for an anti-aging pill.
Still, Braswell seems to have done well for himself financially. His 1999 divorce settlement required him to pay his ex-wife $42 million.