A former manager for the Grateful Dead has been sentenced to five years in federal prison for tax evasion.Ronald Leon Rakow, 69, was ordered to begin his prison term in June for evading payment of $2.2 million in taxes owed to the Internal Revenue Service, the U.S. attorney's office said.

Rakow was convicted in July on a single count of tax evasion. During his two-week trial, prosecutors presented evidence showing Rakow hid his assets to prevent the IRS from collecting taxes dating back to 1985 -- a few years before he served a year in prison on a felony count of mail fraud. Rakow was part of a scheme that convinced more than 27,000 to collectively invest $80 million in a milk-culture growing business that authorites said amounted to a pyramid scheme.

Rakow had asked for a lighter sentence on the tax evasion charge, but a federal judge rejected the request, saying that Rakow broke the law in order to live a comfortable lifestyle.

According to prosecutors, between 1998 and 2003, Rakow transferred about $5.2 million in income from consulting fees, stock and assets under his control into accounts held in other names. Rakow then alledgedy directed accountholders to use the funds to pay his expenses.


Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access