April 24: Testimony describes how Beale stopped withholding taxes

Last update: April 24, 2008 - 12:04 AM

About the time former Comtrol Corp. CEO Robert Beale first ordered people in his payroll department to start sending his checks to a shell company he'd set up, he put up anti-tax posters in the company lunch room, according to Lee Aide, who handled banking for Comtrol.

When the strange transactions continued, Aide went to a public phone in a book store over lunch and called the Internal Revenue Service.

Aide's and another employee's calls prompted authorities to raid the Maple Grove firm in 2004. Beale, who no longer owns the company, is on trial in U.S. District Court in Minneapolis on charges of tax evasion, conspiracy and failure to appear in court. He was also accused Monday of attempting to interfere with a court proceeding by threatening a judge.

During testimony Wednesday, Aide described how Beale, through company managers, stopped withholding taxes from his pay checks. The deception escalated through 2004 as Beale took company money to obtain cashier's checks, which were wired to him or to Switzerland. One check was for $867,000.

Aide quickly realized, "I was unwittingly being part of a crime."

Beale, acting as his own attorney, asked Aide: "Why didn't you come to me with your concerns?"

"Because there was illegal activity going on," he replied.

Instead, Aide and employee Eileen Johnson reported Beale. Each received $40,000 in rewards and may receive more money.

On Tuesday, Beale agreed to undergo a psychological examination, which he had previously declined.

The trial is expected to last two weeks.

JON TEVLIN

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