Al Capone

===Tax evasion===
{{Wikisource|Portal:IRS investigation of Al Capone|IRS investigation of Al Capone}}
[[File:Capone’s criminal record in 1932.jpg|thumb|Capone's [[Federal Bureau of Investigation|FBI]] criminal record in 1932, showing most of his criminal charges were discharged or dismissed]]

[[United States Assistant Attorney General|Assistant Attorney General]] [[Mabel Walker Willebrandt]] is said to have originated the tactic of charging obviously wealthy crime figures with federal [[tax evasion]] on the basis of their luxurious lifestyles.<ref>{{Cite book |last=Bryson |first=Bill |year=2013 |title=One Summer, America, 1927 |publisher=Random House |location=New York |isbn=978-0375434327 |pages=116–117}}</ref> In 1927, the Supreme Court ruled in ''[[United States v. Sullivan]]'' that the approach was legally sound: illegally earned income was subject to income tax.<ref>{{harvnb|Bergreen|1994|p=224}}</ref>

The key to Capone's conviction on tax charges was not his spending, but proving his income, and the most valuable evidence in that regard originated in his offer to pay tax. Ralph, his brother and a gangster in his own right, was tried for tax evasion in 1930. Ralph spent the next 18 months in prison after being convicted in a two-week trial over which Wilkerson presided.<ref>''Al Capone: Chicago's King of Crime'', by Nate Hendley, p. 108</ref> Seeking to avoid the same fate, Al Capone ordered his lawyer to regularize his tax position, and although it was not done, his lawyer made crucial admissions when stating the income that Capone was willing to pay tax on for various years, admitting income of $100,000 for 1928 and 1929, for instance. Hence, without any investigation, the government had been given a letter from a lawyer acting for Capone conceding his large taxable income for certain years he had paid no tax on. On March 13, 1931, Capone was charged with [[income tax evasion]] for 1924, in a secret grand jury. On June 5, 1931, Capone was indicted by a federal grand jury on 22 counts of income tax evasion from 1925 through 1929; he was released on $50,000 bail.<ref name=scarfacecrusaders/> Capone was then indicted on 5,000 violations of the [[Volstead Act]] (Prohibition laws).<ref name="Collins & Schwartz"/>{{Rp|385–421, 493–496}}<ref>{{cite book |last=Okrent |first=Daniel |title=Last Call: The Rise and Fall of Prohibition |url=https://archive.org/details/lastcal_okr_2010_00_9047 |url-access=registration |publisher=Scribner |location=New York |year=2010 |isbn=978-0743277044 |pages=[https://archive.org/details/lastcal_okr_2010_00_9047/page/136 136], 345}}</ref><ref name=scarfacecrusaders>{{cite book |last=Hoffman |first=Dennis |title=Scarface Al and the Crime Crusaders: Chicago's Private War Against Capone |publisher=[[Southern Illinois University Press]] |location=Chicago |year=2010 |isbn=978-0809330041 |pages=159–164}}</ref>

On June 16, 1931, at the [[Chicago Federal Building]] in the courtroom of Wilkerson, Capone pleaded guilty to income tax evasion and the 5,000 Volstead Act violations as part of a {{frac|2|1|2}}-year prison sentence [[plea bargain]]. However, on July 30, 1931, Wilkerson refused to honor the plea bargain, and Capone's counsel rescinded the guilty pleas.<ref name=scarfacecrusaders/> On the second day of the trial, Wilkerson deemed that the 1930 letter to federal authorities could be admitted into evidence, overruling objections that a lawyer could not confess for his client.<ref>{{cite web |url=http://www.myalcaponemuseum.com/id146.htm |title=Al Capone's tax trial and downfall |publisher=Myalcaponemuseum.com |access-date=August 16, 2014 |archive-url=https://web.archive.org/web/20140811022004/http://www.myalcaponemuseum.com/id146.htm |archive-date=August 11, 2014 |url-status=live}}</ref><ref>{{cite web |url=http://law2.umkc.edu/faculty/projects/ftrials/capone/caponeaccount.html |title=Al Capone Trial (1931): An Account by Douglas O. Linder (2011) |publisher=Law2.umkc.edu |access-date=August 16, 2014 |archive-url=https://web.archive.org/web/20140819061348/http://law2.umkc.edu/faculty/projects/ftrials/capone/caponeaccount.html |archive-date=August 19, 2014 |url-status=live }}</ref><ref>[http://law2.umkc.edu/faculty/projects/ftrials/capone/caponechrono.html Al Capone Trial: A Chronology] Daniel M. Porazzo. Retrieved June 30, 2014. {{webarchive |url=https://web.archive.org/web/20141031183951/http://law2.umkc.edu/faculty/projects/ftrials/capone/caponechrono.html |date=October 31, 2014}}</ref> Wilkerson later tried Capone only on the income tax evasion charges as he determined they took precedence over the Volstead Act charges.<ref name=scarfacecrusaders/>

Much was later made of other evidence, such as witnesses and ledgers, but these strongly implied Capone's control rather than stating it. Capone's lawyers, who had relied on the plea bargain Wilkerson refused to honor and therefore had mere hours to prepare for the trial, ran a weak defense focused on claiming that essentially all his income was lost to gambling.<ref name=Iorizzo>{{cite book|first1=Luciano J.|last1=Iorizzo|title=Al Capone: A Biography|url=https://archive.org/details/alcapone00luci|url-access=registration|publisher=Greenwood Publishing Group|date=2003|isbn=978-0313323171|pages=[https://archive.org/details/alcapone00luci/page/81 81]–82|via=Internet Archive}}</ref> This would have been irrelevant regardless, since gambling losses can only be subtracted from gambling winnings, but it was further undercut by Capone's expenses, which were well beyond what his claimed income could support; Wilkerson allowed Capone's spending to be presented at very great length.<ref name=Iorizzo /> The government charged Capone with evasion of $215,000 in taxes on a total income of $1,038,654, during the five-year period.<ref name=scarfacecrusaders/> Capone was convicted on five counts of income tax evasion on October 17, 1931,<ref name="brit">{{cite web|url=https://www.britannica.com/biography/Al-Capone|title=Al Capone – American criminal|website=Encyclopedia Britannica|access-date=January 11, 2020|archive-url=https://web.archive.org/web/20190605201038/https://www.britannica.com/biography/Al-Capone|archive-date=June 5, 2019|url-status=live}}</ref><ref name=ctcvcapn>{{cite news |url=https://www.newspapers.com/clip/14736139/capone_convicted/ |newspaper=Chicago Sunday Tribune |last=Kinsley |first=Philip |title=U.S. jury convicts Capone |date=October 19, 1931 |page=1 |access-date=October 28, 2017 |archive-url=https://web.archive.org/web/20171029065128/https://www.newspapers.com/clip/14736139/capone_convicted/ |archive-date=October 29, 2017 |url-status=live }}</ref><ref name=ccotevsr>{{cite news |url=https://news.google.com/newspapers?id=kRpWAAAAIBAJ&pg=6214%2C983876 |newspaper=Spokesman-Review |location=(Washington) |agency=Associated Press |title=Capone convicted of tax evasion |date=October 18, 1931 |page=1 |access-date=September 19, 2020 |archive-date=January 4, 2021 |archive-url=https://web.archive.org/web/20210104162042/https://news.google.com/newspapers?id=kRpWAAAAIBAJ&pg=6214%2C983876 |url-status=live }}</ref> and was sentenced a week later to 11 years in federal prison, fined $50,000 plus $7,692 for court costs, and was held liable for $215,000 plus interest due on his back taxes.<ref name=csenelv>{{cite news |url=https://news.google.com/newspapers?id=kTdWAAAAIBAJ&pg=5020%2C6914884 |newspaper=Eugene Register-Guard |location=(Oregon) |agency=Associated Press |last=Hackler |first=Victor |title=Capone sentenced 11 years, fined $50,000 |date=October 24, 1931 |page=1 |access-date=September 19, 2020 |archive-date=January 4, 2021 |archive-url=https://web.archive.org/web/20210104162148/https://news.google.com/newspapers?id=kTdWAAAAIBAJ&pg=5020%2C6914884 |url-status=live }}</ref><ref name=cpjlpnx>{{cite news |url=https://www.newspapers.com/clip/14342512/1931_10_24_capone_sentenced_front_page/ |newspaper=Chicago Sunday Tribune |title=Capone in jail; prison next |date=October 25, 1931 |page=1 |access-date=October 28, 2017 |archive-url=https://web.archive.org/web/20171029065305/https://www.newspapers.com/clip/14342512/1931_10_24_capone_sentenced_front_page/ |archive-date=October 29, 2017 |url-status=live }}</ref><ref name=ckmappl>{{cite news |url=https://news.google.com/newspapers?id=f5kRAAAAIBAJ&pg=2892%2C4301 |newspaper=Eugene Register-Guard |location=(Oregon) |agency=Associated Press |last=Brennan |first=Ray |title=Capone kept until Monday for appeal |date=October 25, 1931 |page=1 |access-date=September 19, 2020 |archive-date=January 4, 2021 |archive-url=https://web.archive.org/web/20210104162048/https://news.google.com/newspapers?id=f5kRAAAAIBAJ&pg=2892%2C4301 |url-status=live }}</ref><ref name="court">{{cite web|title=Visitors to the Court-Historic Trials |publisher=US District Court-Northern District of Illinois |access-date=February 10, 2011 |url=http://www.ilnd.uscourts.gov/home/CourtHouseVisitors.aspx |url-status=dead |archive-url=https://web.archive.org/web/20110721065913/http://www.ilnd.uscourts.gov/home/CourtHouseVisitors.aspx |archive-date=July 21, 2011}}</ref> The contempt of court sentence was served concurrently.<ref>{{cite web |url=http://law2.umkc.edu/faculty/projects/ftrials/capone/caponeverdict.html |title=Selected Documents: Jury Verdict Form (October 17, 1931) |work=Al Capone Trial |first=Douglas O. |last=Linder |publisher=University of Missouri–Kansas City |access-date=October 16, 2011 |archive-url=https://web.archive.org/web/20110827060820/http://law2.umkc.edu/faculty/projects/ftrials/capone/caponeverdict.html |archive-date=August 27, 2011}}</ref><ref>{{harvnb|Bergreen|1994|p=484}}</ref><ref>{{harvnb|Bergreen|1994|pp=486–487}}</ref> New lawyers hired to represent Capone were Washington-based tax experts. They filed a writ of ''[[Habeas corpus in the United States|habeas corpus]]'' based on a Supreme Court ruling that tax evasion was not fraud, which apparently meant that Capone had been convicted on charges relating to years that were actually outside the time limit for prosecution. However, a judge interpreted the law so that the time that Capone had spent in Miami was subtracted from the age of the offences, thereby denying the appeal of both Capone's conviction and sentence.<ref>{{harvnb|Bergreen|1994|p=516}}</ref>