United States v. John D. Clardy

John D. Clardy appeals from a judgment of conviction in the United States District Court for the Northern District of California on three counts of an indictment charging him with three separate violations of 26 U.S.C. § 7206 (2). That section, in relevant part, makes it an offense if any person “[wjillfully aids or assists in, or procures, counsels, or advises the preparation or presentation under . . . the internal revenue laws, of a return . . . which is fraudulent or is false as to any material matter . . . .” A jury found Clardy guilty on each of the three counts after a trial before Honorable William H. Orrick, District Judge.

The three counts charged that Clardy aided, assisted, etc. in the .preparation and presentation of income tax returns for the year 1971 by three dentists and their respective wives. Each count charged that the return was false and fraudulent in that it represented that the taxpayers were entitled to a prepaid interest expense deduction whereas Clardy knew that they were not so entitled. The first count involved the return of Don C. and Elizabeth Ann Johnson; the second count involved the return of Delmar R. and Diane Mobley; and the third count…