Triad Industries manager faces IRS investigation, lawyer says
Steve Korris Apr. 15, 2009, 9:56am
Jeffrey Heintz, who ran Triad Industries while Ricki Lee Jones stole millions through the company, faces prosecution for tax crimes like those Jones admitted.
"Mr. Heintz is currently under federal investigation," lawyer Jarrod Beasley told Madison County Associate Judge Duane Bailey at an April 9 hearing.
Beasley said Internal Revenue Service agents would meet with Heintz on April 15.
He asked Bailey to keep Heintz off the witness stand in a divorce trial between Rick and Dorothy Jones, but Bailey said Heintz would have to appear.
"If he chooses to assert his Fifth Amendment right, you have an absolute right to do that," Bailey said.
Dorothy Jones sought testimony from Heintz for a trial Bailey set to start April 13.
As of April 15, the trial had not begun.
Bailey has allowed negotiations to continue. He said if a settlement was not reached by the end of Wednesday, the trial would begin Thursday, April 16.
In January, Rick Jones pleaded guilty to charges that he failed to pay taxes on money Triad Industries received as pollution cleanup contractor at BP Amoco's refinery.
He admitted spending much of the money for the personal benefit of himself and others.
He agreed to pay $2.4 million in taxes and $1.2 million in restitution to BP Amoco.
He agreed to testify before "the grand jury" or any court investigating any crime whether it involved him or not.
In March his divorce attorney, David Fahrenkamp, tried to postpone the divorce trial.
Fahrenkamp wrote to Bailey that when Jones agreed to an April trial he expected to be taken into custody on May 7.
Jones has since been advised that he won't be taken into custody on May 7 and might not serve any time, Fahrenkamp wrote.
"At sentencing it will be determined whether the petitioner will serve a term of imprisonment and, if so, for how long," he wrote.
If Jones is sentenced to prison on May 7, he wrote, he would be permitted to voluntarily surrender several weeks later.
In the meantime, Jones's sentencing date has been pushed back to May 28.
Bailey denied a delay, and Dorothy Jones served a subpoena on Heintz.
Lawyer Clyde Kuehn sought relief for Heintz on April 8, and Bailey arranged a hearing the next morning.
Kuehn sent Beasley, who said Heintz would try to work something out with the IRS.
"It is conceivable that after that point he might be able to testify," Beasley said.
"It is also conceivable that we don't work anything out and the thing proceeds and there is an indictment and the whole process begins," he said.
He said Dorothy Jones's lawyers provided questions but Heintz couldn't answer them because he didn't know what an indictment might allege.
"We only know that he is under federal investigation by criminal agents of the IRS," Beasley said.
"As the court can imagine, that could encompass a very broad net," he said.
For Dorothy Jones, Wendy McIntyre asked Bailey to reserve ruling until she put Heintz on the stand.
"I think there probably are questions that could implicate him," McIntyre said.
"A blanket order that quashes the subpoena completely would be against the law as it relates to a civil case," she said.
Bailey asked Beasley for the last word but Fahrenkamp broke in to ask, "Do I have a dog in this fight, judge?"
Bailey told him to go ahead, and Fahrenkamp said it was a problem of timing.
"If I were representing Mr. Heintz, knowing only what I have been told by counsel for him, I would from the first question after his name have him assert the privilege," he said.
"I think this is common sense," he said.
He told Bailey he wouldn't have to rule on it until Heintz sits on the stand.
"You really have broad discretion but we all know it is going to happen," he said.
"We all know it is going to be asserted," he said.
Bailey again asked Beasley for the last word and Beasley said, "Without knowing what the charges are it is impossible for us to say, you can't answer that."
He said, "It puts us in a horrible position, especially with regards to future litigation."
He said Heintz couldn't move for a stay because he wasn't a party to the trial.
"We don't have that standing," he said.
"We are kind of fighting an uphill battle here, your honor," he said.
Bailey said, "I'm afraid you will continue to fight the uphill battle."
"I'm not going to quash the subpoena," Bailey said.
He still hadn't heard the last word.
McIntyre asked to take up motions she filed about questions Rick Jones didn't answer and his assertion of Fifth Amendment rights.
Fahrenkamp said, "I just received them yesterday."
Bailey said, "They arrived in my office yesterday evening."
"Even though I wish these had been produced earlier, we will take up all of these motions at nine o'clock Tuesday morning," Bailey said.
When the hour of trial arrived, no one showed up in Bailey's court.
A bailiff said the parties were negotiating a settlement.