LOS ANGELES, CA — Joe Francis, founder of the infamous “Girls Gone Wild” empire, was arraigned Monday on federal tax-fraud charges. The case, which arose last year in Reno, NV, was transferred to Los Angeles, CA, in May.In addition to charges he claimed more than $20 million in bogus deductions on his 2002 and 2003 corporate tax returns, Francis also is accused of illegally transferring $15 million from an offshore bank account to a California brokerage firm.
Among the allegedly irregular tax deductions for which Francis is under scrutiny are $3.78 million that was claimed as a business expense but instead allegedly was used to build a home in Mexico, $10.4 million in allegedly phony consulting services and a $500,000 allegedly bogus insurance claim.
If convicted, Francis faces as many as 10 years in federal prison and $500,000 in fines.
Francis was indicted in April 2007 after the former accountant for his company Mantra Films allegedly requested a multimillion dollar federal reward for ratting out Francis’ allegedly dodgy tax accounting.
According to a statement from his attorneys, the case will reveal that the truth is “about an accountant who thinks he should be rewarded for his own mistakes, mistakes that will cost Joe millions of dollars. The IRS says the accountant should get millions and Joe prison for mistakes the accountant made and never told Joe he made. That’s outrageous.”
Francis, a graduate of the University of Southern California who plied amateur videos of drunken, topless college girls into a multimillion-dollar empire, is no stranger to tax-evasion charges. He recently served 11 months in jail on unrelated tax charges.
He has had other legal problems, as well. In 2006 he was sentenced to probation in Florida after pleading no contest to violating 18 USC 2257, the federal adult-entertainment records-keeping and labeling law. In March, he pleaded no contest to child abuse and prostitution charges stemming from the appearance of allegedly underage girls in some of his videos.
In the civil sphere, Ashley Dupre, the high-dollar New York call girl linked to former Gov. Eliot Spitzer, accused Francis of filming her when she was only 17 and subsequently threatened to sue him. That led to another suit against Francis: After Francis released a video of Dupre posing for his camera while holding a driver’s license bearing the name Amber Arpaio, the real Amber Arpaio filed suit against both Dupre and Francis for allowing her lost driver’s license to be used in producing an adult video.
