A surreal end to tax protester's odyssey

  • Article by: JAMES WALSH JWALSH@STARTRIBUNE.COM , Star Tribune
  • Updated: September 11, 2008 - 11:16 PM

At his sentencing, Robert Beale alternated between remorse and existential diatribe. He got 11 years to sort things out.

After years of defying the government, of hiding millions in income from the IRS and then going into hiding, Robert B. Beale calmly stood before U.S. District Judge Ann Montgomery on Thursday and, for a moment, acknowledged the trouble he had caused.

"I am very sorry for the many decisions I have made over the last 10 years," he said. "I ask forgiveness from everyone involved. My goal is to be a good example for my family."

Then, as Montgomery was about to impose sentence for tax evasion, something happened. The old tax protester reappeared, insisting that the judge, the court and the country have no power over him.

"I deny the existence of the fictitious defendant Robert Beale," he said. "I do not consent to incarceration, a fine or supervised release. I have not committed a crime. There's nothing for which to convict me. I have been found not guilty by a jury of my peers. I have been released."

Then Montgomery brought Beale, 65, back to reality, sentencing him to more than 11 years in prison for hiding more than $5 million in income and owing the state and federal governments more than $4 million in unpaid taxes, interest and penalties.

Like much of Beale's trial, the sentencing Thursday was an odd display of the many faces of a millionaire-turned-rebel-turned-fugitive.

At first, Beale, who acted as his own attorney, grilled an IRS investigator on what laws gave the government authority to tax him. When Montgomery cut him off, he sat mostly quietly, arms folded.

Then, when it was his turn to make a statement, Beale proceeded to recite from a list of his life and accomplishments.

Beale choked up at times as he recounted milking cows on his family's farm at the age of 8, becoming a Christian, winning a National Merit Scholarship, and conducting engineering research at MIT during the Vietnam War.

He talked of working on guidance systems for Honeywell, serving as a youth minister, designing jet engines, forming his own technology company, inventing medical devices, meeting presidents and religious leaders, and starting churches overseas. And he talked about, in 2000, beginning to contest the country's tax code. He often filed paperwork challenging the IRS and Minnesota Department of Revenue.

"In the future, I would like to continue my work in starting churches and creating medical devices," he said.

Assistant U.S. Attorney Timothy Rank pointed out that, despite Beale's apparent contrition, he has continued from jail to use online message boards to encourage others to refuse to pay taxes. Rank asked Montgomery to give Beale a tougher sentence.

"Mr. Beale has shown with his conduct in this case that he has no respect for the law," Rank said.

The judge agreed, saying to Beale: "There are aspects of your case I won't pretend to understand."

She said she has a stack of letters from friends, family and associates of Beale's. "And they don't speak with a single voice at all," she said. Some call him greedy and a bad man, Montgomery said. Others extol his virtues.

"You were the personification of the American Dream, only to throw it all away because you chose not to pay your taxes," she said.

Paid in cash

From 2000 through 2004, Beale, the former millionaire CEO of Comtrol Corp. in Maple Grove, directed that he be paid in cash through a shell company in order to hide his income. After the Minnesota Department of Revenue issued subpoenas for payroll documents, Beale removed them from the building and stopped sending invoices. He eventually was paid through cashier's checks and sent money to Swiss bank accounts.

When Beale was charged in 2006, he fled. While on the run, Beale, through a son, tried to get $600,000 from his Swiss bank account to buy property in Switzerland. He also filed a phony document to have a lien removed on a seized property, which he then tried to sell.

He was arrested in November at a strip mall in Orlando, Fla., after 14 months on the run, carrying a fake passport and driver's license issued from "The Kingdom of Heaven."

On April 30, federal jurors convicted him on seven counts of tax evasion, conspiracy and fleeing authorities. Jurors needed only two hours to find him guilty.

On Thursday, Beale denied once again that the federal government could tell him what to do. Then the U.S. marshals took him away.

James Walsh • 612-673-7428

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