The Miccosukee Indians have made an unprecedented admission that over one hundred of its members owe the US government millions of dollars in taxes handed out from gambling profits at its West Miami-Dade casino operation. According to a report by The Miami Herald the details were unleashed during a malpractice lawsuit brought by the tribe against its former lawyer, Dexter Lehtinen.
The tribe complained that Lehtinen gave them “faulty advice” over personal income disputes, using IRS audits between 2000 and 2005 as evidence. Due to Lehtinen’s alleged “faulty advice”, the tribe believe its members have incurred “outrageous interest and penalties”.
The Miccosukee’s claim they were told by Lehtinen – whose law firm was paid $50 million for advice on taxation and other legal issues from 1992 – that for many years Lehtinen advised them they owed no individual income taxes on the gambling distributions. However, allegedly he changed his position before he was fired in 2010 after a change of tribal leadership.
The lawsuit claims that Lehtinen gave them false information, a fact which showed “a clear and concise picture of the fraud he committed upon tribal members in order to collect outrageous fees,” it states. But Lehtinen’s lawyer, Joseph Klock, said the Miccosukee Tribe is suing his client because it needs a “bogey man” to pay for the mistakes of its political leaders. “Those folks left him high and dry. Their case is absolutely ridiculous,” Klock said.
According to records, 117 Miccosukee Tribe members were issued with “notices of deficiency” by the IRS, with a demand to pay taxes on the gambling income. While they initially owed a combined $9.8 million, due to not settling on time, interest and penalties have ensured the hefty $25.8 million owed today. Nevertheless, a hearing is scheduled for 24 Feb in Miami federal court on the IRS’ latest effort to obtain personal financial records from all Miccosukee members.