Schererville attorney Raymond Gupta, whose law license was suspended in June, has been indicted for tax evasion and failing to file federal tax returns, with the federal government claiming he owes nearly $2 million to the Internal Revenue Service.
In a five-page indictment filed Oct. 16 in U.S. District Court for the Northern District of Indiana, Hammond Division, the U.S. Attorney for the Northern District of Indiana alleged Gupta ignored more than 40 mailings from the IRS, did not voluntarily make any payments to reduce his tax debt, and sought to avoid IRS levies by pulling large sums of money from the banking system.
Kerry Connor, a federal criminal defense attorney in Highland, has entered an appearance for Gupta. She declined to comment.
According to the indictment, Gupta owes the IRS close to $260,000 for tax years 2002 and 2003. Also, he failed to timely file a federal tax return from 2007 through 2018, and now owes the IRS nearly $2 million in taxes, penalties and interest.
The indictment claims that between 2013 and 2018, Gupta had a gross income of $6.33 million.
Gupta has been indicted on one count of evading payment of federal income taxes for 2002 and 2003, and six counts of failing to file a federal tax return for 2013 through 2018.
He is alleged to have bought cashier’s checks to prevent the IRS from seizing his funds, using a land trust contract to conceal the purchase of a personal residence for almost $1.1 million, and using a relative and friends to hide money from the IRS.
In addition, he is accused of paying personal expenses from his law firm’s bank accounts. These expenses included the purchase of vehicles, rent for a downtown Chicago apartment, furnishings for two homes, monthly mortgage payments, a $150,000 payment for an option to buy a personal residence and the purchase of a personal residence for nearly $1.1 million.
Failure to file tax returns is also part of the disciplinary complaint filed against Gupta in February 2019. In his response to the allegations, he admitted he had not filed a tax return since 2009. Also, he acknowledged he had told the commission in an August 2018 deposition that his goal was to get his taxes filed “in 30 to 60 days, I mean whatever time they need to prepare the return, but I would like to see it done in 30 days.”
Gupta, who practiced primarily in the areas of personal injury and medical malpractice, faces additional disciplinary charges related to his handling of two trust accounts. The Indiana Supreme Court Disciplinary Commission’s May petition that Gupta’s Indiana license be immediately suspended was granted by the Indiana Supreme Court.
In August an amended disciplinary complaint was filed, bringing the total charges to 22 counts. The commission accuses Gupta of numerous violations of the Indiana Rules of Professional Conduct, including failing to maintain trust account records, commingling his funds with those of his clients, failing to promptly deliver client funds, charging and/or collecting unreasonable fees or expenses, and failing to explain to clients their options when an associate attorney left his firm.
Moreover, the commission accuses Gupta of committing the criminal act of conversion for exercising unauthorized control over one or more of his clients’ funds held in one of his trust accounts in order to cover the payments to another client.
Gupta has denied that allegation in his written response to the original complaint filed in February. His attorney, Michael Brown, partner at Kightlinger & Gray LLP in Indianapolis, declined to comment.
That allegation arises from a review of the financial records from one client’s personal injury claim. The commission found the case settled for $310,000. Gupta said he had made partial payments to the client because she wanted to get smaller amounts periodically rather than one lump sum. The commission calculated disbursements to the client from the trust account topped $200,000, and disbursements made to Gupta and third parties reached $134,817.17, for a total of $330,000.
Since the amount paid out was $20,000 more than the settlement, the commission concluded Gupta converted at least $20,000 of other clients’ funds and exercised unauthorized control over clients’ money or, in the alternative, commingled about $20,000 of his own personal and/or business funds with clients’ funds.
According to the complaint, the commission had filed a previous grievance against Gupta in March 2010 for overdrawing his Interest On Lawyers Trust Account on April 17, 20 and 21, 2009. The complaint was ultimately dismissed after Gupta completed the 3-hour online course “Trust Accounts Made Easy.”
However, in December 2018, he told the commission that he admitted to his “failure to learn the intricacies of trust accounting … but I believed canceled checks and the check register would serve as sufficient documentation.” Also, he admitted his “failure to learn the intricacies of trust management and that I kept bulk records instead of specific records for each client.”
Also, Gupta admitted to the allegations that the records for his two trust accounts were canceled checks, a check register or “handwritten summaries” on a legal pad. As each page became full, he would “start another and discard the previous page.”
The disciplinary commission has alleged Gupta made false statements during the disciplinary investigation and altered or concealed a document or other material having potentially evidentiary value. Gupta has denied those allegations.
The complaint contains numerous examples of alleged violations related to specific clients. Gupta was found to have not responded to clients’ inquiries about the status of their cases and their settlements. After one case was settled for $100,000, the client claimed she had not approved the amount. Gupta denied that allegation.
Another client was charged $8,000, later reduced to $6,000, for travel expenses. Gupta told the commission he charged 50 cents per mile and expenses he charged to the client covered the traveling he had to do between Chicago and Northwest Indiana for the case. He also charged that same client $18,000 in copying fees.
According to the complaint, Gupta advised his clients to get treatment from specific medical providers. One of the providers was Julian Ungar-Sargon, M.D., who operates Neurology and Pain Management. Gupta was found to have paid Ungar “on numerous occasions” without receiving an invoice for services, telling the commission, “I would make out the check any way that he (Ungar) asked me to make it out within reason.”
The disciplinary case, In the Matter of Raymond Gupta, 129S-CO-71, is continuing. The commission is awaiting Gupta’s response to the amended complaint.