Broadcaster and Broker Susan Patrick Pleads Guilty to False Tax Filings
Susan Patrick, co-owner of broadcast brokerage Patrick Communications and radio broadcaster Legend Communications, pleaded guilty to a felony charge of filing a false tax return and trying to conceal $9.5 million in earnings from the IRS in returns for the 2012, 2013 and 2014 tax years, said criminal filings (docket 1:23-cr-00254) Aug. 31 in U.S. District Court for Maryland in Baltimore and publicized in a DOJ release.
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
Though she resigned her positions with the companies, the guilty plea could have consequences for the licenses of the largest radio station chain in Wyoming, attorneys told us. Susan Patrick is married to Patrick Communications co-owner Larry Patrick-- a member of the NAB Radio Board -- and his tax returns are included in the false filings, but she said he and their business partner, Gregory Guy, had no knowledge of the false tax filings. “I am sincerely sorry for the pain and embarrassment that this is causing my family, friends and business associates,” said Susan Patrick in a released statement.
In 2016, after the IRS requested unfiled tax returns for the Patricks and Patrick Communications for 2012-2014, Susan Patrick doctored personal and business tax returns for those years to conceal $10 million in the total earnings for Patrick Communications and the $9.5 million in personal income those earnings generated for both her and her husband, said the DOJ release. Susan Patrick “also falsely backdated her signature on each tax return to make it appear as if the returns had been timely signed and mailed these falsely doctored documents to the IRS, hoping to evade paying the full amount of taxes she owed,” DOJ said.
In total, Susan Patrick "sought to evade" more than $2.5 million in taxes, said DOJ. The initial IRS request for the unfiled returns stemmed from a 2016 collections case over unfiled employment tax returns for the brokerage, said the plea agreement.
In her statement, Patrick sought to distance the brokerage and broadcast stations from the crime. But attorneys told us that historically and recently, the FCC has opened enforcement proceedings on the licenses of broadcasters convicted of felonies, especially those that involve false statements to federal agencies.
The media brokerage continues “to operate with the highest levels of integrity and expertise that you all have experienced from them in the past,” said the release. “Legend Communications is not related to this tax issue in any way.” Legend bills itself as “Wyoming’s largest radio broadcasting company” and owns 22 radio stations and three translators. Patrick Communications’ website says the firm has handled $8.5 billion in transactions. Larry Patrick, Guy and the FCC didn’t comment.
The agency is unlikely to overlook a broadcast owner pleading guilty to a felony, and generally scrutinizes issues of candor, attorneys said. “The FCC has said they will go after any licensee who is convicted of a felony,” said Andrew Ward, an attorney with the Institute for Justice. He represents Joseph Armstrong, principal of broadcaster Arm & Rage, in an ongoing license proceeding over Armstrong’s conviction for making a false statement on a tax form. Armstrong’s crime occurred in 2009, three years before he became owner of WJBE(AM) Powell, Tennessee, and the FCC still sought a hearing proceeding, said Ward.
Ward said the FCC has consistently gone after convicted broadcasters, though the results have been uneven. Auburn Network owner Michael Hubbard was allowed to keep his licenses after being convicted of felonies involving corruption charges (see 2205090059. The FCC Enforcement Bureau sought to take Pennsylvania radio broadcaster Roger Wahl’s FCC license after he was convicted of attempting to have a woman sexually assaulted, and the hearing proceeding was terminated over his nonparticipation. Wahl appealed that termination.
Under the terms of the plea agreement, Patrick pleaded guilty to one count of “willfully making and subscribing a false tax return,” for the 2013 tax form. She will be sentenced in December, and could receive up to a three-year sentence and monetary penalties, according to DOJ. She agreed to pay $2.5 million in restitution. “This is a tax obligation based on a very serious lapse of judgment a decade ago,” wrote Susan Patrick: “I am fully ready to be held accountable and to do whatever I can and need to do to make up for my decisions of the past.”