United States 9th Circuit Court of Appeals Reports
CARTY v. ASHCROFT, 395 F.3d 1081 (9th Cir. 2005) Theophile
CARTY, Petitioner, v. John ASHCROFT, Attorney General,
Respondent. No. 03-71392. United States Court of Appeals,
Ninth Circuit. Argued and Submitted November 4, 2004.
Filed January 19, 2005. Page 1082
Matthew G. Ball (briefed and argued), Kirkpatrick &
Lockhart, San Francisco, CA, for the petitioner.
Edward C. Durant (argued) and David E. Dauenheimer
(briefed), Office of Immigration Litigation, Department of
Justice, Washington, D.C., for the respondent.
On Petition for Review of an Order of the Board of
Immigration Appeals.
Before: CANBY, JR., RYMER, and HAWKINS, Circuit Judges.
MICHAEL DALY HAWKINS, Circuit Judge.
We must decide whether “intent to evade” is synonymous
with “intent to defraud” within the meaning of the removal
provisions of the Immigration and Nationality Act (“INA”).
Because we conclude the terms are synonymous, we dismiss
the petition for review of Dr. Theophile Carty (“Carty”).
Carty, a native of Anguilla, petitioned this court for
relief from a Board of Immigration Appeals’ (“BIA”)
decision affirming an Immigration Judge’s (“IJ”)
determination that willful failure to file state income
taxes under California Revenue and Taxation Code §
19406 (1992) (“Section 19406”) is a crime involving moral
turpitude, thereby subjecting Carty to removal pursuant to
INA § 237(a)(2)(A)(ii) for conviction of two or more
crimes involving moral turpitude.
While we generally do not have jurisdiction to consider
challenges to removal orders brought by aliens removable
Page 1083 pursuant to INA § 237(a)(2)(A)(ii), see 8
U.S.C. § 1252(a)(2)(C), we can determine whether we
have jurisdiction. See Huerta-Guevara v. Ashcroft, 321 F.3d
883, 885 (9th Cir. 2003). As part of this jurisdictional
inquiry, we may examine whether Section 19406 tax evasion
constitutes a crime of moral turpitude. Hernandez-Martinez
v. Ashcroft, 329 F.3d 1117, 1118 (9th Cir. 2003).
I. BACKGROUND
Carty immigrated to the United States in 1965 and became a
lawful permanent resident in 1975. Working as a licensed
physician in Los Angeles, Carty made a comfortable and, it
turns out, largely unreported income.[fn1] The State of
California charged Carty with the willful failure to file a
state income tax return in 1991 and 1992, in violation of
Section 19406. Carty pled nolo contendere to both counts,
and was sentenced to ninety days house arrest, payment of
all past taxes due, and probation for three years. In 2001,
Carty pled guilty to attempted bribery of a government
official, admitting that he offered money to obtain a U.S.
passport for a non-citizen. He was sentenced to eighteen
months imprisonment and three years probation.
The INS thereafter commenced removal proceedings against
Carty pursuant to INA § 237(a)(2)(A)(ii)[fn2] for
conviction of two or more crimes involving moral turpitude.
In the face of Carty’s argument that failure to file a tax
return is not a crime involving moral turpitude,[fn3] the
IJ ruled that Carty’s willful failure to file a return with
the intent to evade taxes constitutes a crime involving
moral turpitude. The BIA affirmed, specifically concurring
with the IJ’s moral turpitude determination.
II. DISCUSSION
Whether a state statutory crime necessarily involves moral
turpitude is a question of law, subject to de novo review.
Rodriguez-Herrera v. INS, 52 F.3d 238, 240 n. 4 (9th Cir.
1995). Crimes of moral turpitude are of basically two
types, those involving fraud and those involving grave acts
of baseness or depravity. Rodriguez-Herrera, 52 F.3d at
240. For analytical purposes, tax evasion falls within the
first category.
Section 19406 provided in pertinent part:
Any person who . . . willfully fails to file any return
or to supply any information with intent to evade any tax
imposed by this part, or who, willfully and with like
intent, makes, renders, signs, or verifies any false or
fraudulent return or statement or supplies any false or
fraudulent information, is punishable. . . .[fn4]
Section 19406 is a divisible statute, constituting (1)
willful failure to file a return or to supply information
with the intent to evade taxes, and (2) willful making of a
false or fraudulent return or statement or supplying any
false or fraudulent information. Page 1084
When a statute is divisible into several crimes, some of
which may involve moral turpitude and some not, it is
appropriate to examine the “record of conviction” to
determine which part applies to the defendant. See Wadman
v. INS, 329 F.2d 812, 814 (9th Cir. 1964),
Hernandez-Martinez, 329 F.3d at 1118-19. Here, Carty was
convicted of “willfully and unlawfully fail[ing] to file
any return or to supply any information with intent to
evade any tax imposed by this part.”
To involve moral turpitude, intent to defraud must be an
“essential element” of Carty’s conviction. See Goldeshtein,
8 F.3d 645, 647 (9th Cir. 1993). Looking to the language of
Section 19406, the willful failure to file section does not
specifically list intent to defraud as an element, nor is
it alleged in Carty’s indictment. However, Section 19406
does list intent to evade taxes as an element, and the
government must prove “specific intent to evade a tax”
under the substantially identical Section 19706. See
California Jury Instructions, Criminal, 7th Ed. §
7.66 (2004).[fn5]
We have held that “[e]ven if intent to defraud is not
explicit in the statutory definition, a crime nevertheless
may involve moral turpitude if such intent is `implicit in
the nature of the crime.'” Goldeshtein, 8 F.3d at 648
(quoting Winestock v. INS, 576 F.2d 234, 235 (9th Cir.
1978)).[fn6] Intent to defraud is implicit in willfully
failing to file a tax return with the intent to evade
taxes. Unlike Goldeshtein, where the court found that
willfully structuring transactions did not inherently
involve fraud because it only deprived the government of
information and did not obtain anything from the
government, id. at 649, here Carty deprived state
government of more than mere information. By willfully
failing to file his tax returns, he attempted to deprive
the government of revenue — or, in other words, to
obtain a free pass on taxes.
The closest analog to Section 19406 is 18 U.S.C. §
145(b) (1939), which prohibits the willful attempt “in any
manner to evade or defeat any tax.” See Khan v. Barber, 147
F.Supp. 771, 775 n. 2 (N.D.Cal. 1957), aff’d, Khan v.
Barber, 253 F.2d 547 (9th Cir. 1958). Khan held that
§ 145(b) is a crime of moral turpitude, 253 F.2d at
549, as did Tseung Chu v. Cornell, 247 F.2d 929, 934 (9th
Cir. 1957). Courts had consistently interpreted tax evasion
under § 145(b) as requiring “an intent to defraud
the government.” Khan, 253 F.2d at 549. As Tseung Chu
explained,
[T]he Courts have, with apparent unanimity, held that in
order for a conviction under § 145(b) to stand, the
government is required to prove that the evading taxpayer
had a specific intent to evade taxation amounting to an
intent to defraud the United States. Page 1085
Fraud is so inextricably woven into the term willfully,
as it is employed in § 145(b), that it is clearly
an ingredient of the offense proscribed by that section.
Only by creating unwarranted semantic distinctions could a
contrary conclusion be reached.
247 F.2d at 933 (quoting Khan, 147 F.Supp. at 775). The
reasoning of Khan and Tseung Chu — that fraud is
clearly an ingredient of § 145(b) — applies
with equal force to Section 19406’s intent to evade
requirement.[fn7] This leads us to determine that intent to
evade under Section 19406 is tantamount and equivalent to
an intent to defraud for deportation purposes.
Moreover, the terms “evasion” and “fraud” have been
treated interchangeably by California and the federal
government. In California, the penalty for tax “fraud or
intent to evade” is the same. Cal. Rev. & Tax. Code
§ 6485. Similarly, the federal tax fraud penalty
statute, while not specifically denoting “intent to evade,”
requires proof that “the taxpayer has engaged in conduct
with the intent to evade taxes that he knew or believed to
be owing.” United States v. Walton, 909 F.2d 915, 926 (9th
Cir. 1990); 26 U.S.C. § 6653(b).
Just as fraud has been defined to mean intent to evade,
intent to evade has generally been held to require proof
of fraud.[fn8]
Federal tax statutes with an “intent to evade” element, and
no specific fraud requirement, have still been interpreted
as requiring an intent to defraud. See Tseung Chu, 247 F.2d
at 933 (interpreting 18 U.S.C. § 145(b)); Windham v.
Bd. of Med. Quality Assurance, 104 Cal.App.3d 461, 469, 163
Cal.Rptr. 566 (1980) (interpreting 26 U.S.C. §
7201). Thus, it cannot be said that willful evasion of
taxes under Section 19406 does not implicitly involve
fraud.
III. CONCLUSION
Having determined that willful failure to file a tax
return, with the intent to evade taxes, involves fraud, and
thus constitutes a crime of moral turpitude, we dismiss the
petition for lack of jurisdiction.
DISMISSED.
[fn1] The record shows Carty made, on average, $3,000 per
week from 1984 to 1996.
[fn2] INA § 237(a)(2)(A)(ii) states, “Any alien who
at any time after admission is convicted of two or more
crimes involving moral turpitude, not arising out of a
single scheme of criminal misconduct, regardless of whether
confined therefor and regardless of whether the convictions
were in a single trial, is deportable.”
[fn3] Carty did not raise the issue of whether attempted
bribery of a government official is a crime of moral
turpitude below, and does not raise it on appeal.
[fn4] The California legislature repealed Section 19406 in
1994 and replaced it with a substantially identical Section
19706. See Cal. Rev. & Tax. Code § 19706 (2004).
[fn5] Carty argues that intent to evade taxes is not
necessarily the same as intent to defraud the government,
citing United States v. Scharton, 285 U.S. 518, 52 S.Ct.
416, 76 L.Ed. 917 (1932). Scharton only held that a statute
must explicitly include an intent to defraud for the
government to avail itself of the six-year statute of
limitations for fraud actions. 285 U.S. at 521-22, 52 S.Ct.
416. The narrow construction applied to statute of
limitations issues led to a holding that an income tax
statute requiring willful attempt to evade or defeat taxes
does not fall within the fraud exception. Id.
[fn6] Goldeshtein, in distinguishing Matter of Flores, 17
I. & N. Dec. 225 (BIA 1980), and other cases on which the
government relied, noted that structuring financial
transactions does not involve “some false or deceitful
conduct through which the alien obtained something from the
government.” 8 F.3d at 649. While a useful guideline,
Goldeshtein did not hold that such false or deceitful
conduct was a necessary element in determining whether a
crime involved moral turpitude.
[fn7] Neither the holding in Tseung Chu, that “an intent to
defraud the government is a prerequisite to conviction
under section 145(b) and hence, a conviction thereof where
such fraud is charged in the indictment, is conviction of a
crime involving moral turpitude,” 247 F.2d at 936, nor the
identically worded holding in Khan, 253 F.2d at 549,
suggest that charging fraud in the indictment is the only
situation in which moral turpitude may be found. As we said
in Goldeshtein, another situation in which moral turpitude
may be found is when fraud is implicit in the nature of the
crime. 8 F.3d at 648.
[fn8] The willful failure to file section of Section 19406
does not require proof of fraud. See California Jury
Instructions, Criminal, 7th Ed. § 7.66 (2004)
(enumerating elements of substantially identical Cal. Rev.
& Tax. Code § 19706).
CANBY, Circuit Judge, dissenting:
As a matter of first impression, I would be willing to
accept the majority’s position that willful failure to file
a tax return with intent to evade a tax is necessarily a
crime of moral turpitude. It is not a matter of first
impression, however, and in my view our precedent requires
a contrary result.
In Tseung Chu v. Cornell, 247 F.2d 929 (9th Cir. 1957), we
addressed the question whether a violation of 26 U.S.C.
§ 145(b) was a crime of moral turpitude. Section
145(b), as it then existed, proscribed willful attempts to
evade a tax. We held that a violation of section 145(b) was
a crime of moral turpitude, but we did not arrive at that
conclusion from the face of the statute itself or from the
mere fact of conviction. We relied on earlier case law
holding that proof of fraud was required to sustain a Page
1086 conviction under section 145(b). We then said of
Tseung Chu:
He was here charged with making in each of four years “a
false and fraudulent income tax return.” Fraud may not be
an essential element of the crime of wilful attempt to
defeat or evade the income tax, but it can be an essential
part of that crime. Here fraud was charged as part and
parcel of the crime, and to that crime so involving
appellant’s alleged fraudulent acts, appellant plead nolo.
Id. at 935 (internal citation omitted). Thus in Tseung Chu
we relied on a specific allegation of fraud in order to
arrive at the conclusion that the crime involved moral
turpitude. There was no such allegation in Carty’s
conviction; he pleaded nolo contendere to two counts
alleging only that he “did willfully and unlawfully fail to
file any return or to supply any information with intent to
evade any tax imposed by this part.”[fn1] Tseung Chu’s
reasoning makes it clear that such an allegation is not
enough to establish moral turpitude.
Indeed, Tseung Chu elsewhere makes the point even more
specifically than it did in the passage I have quoted
above. Anticipating this court’s adverse approach, Tseung
Chu had managed to have his earlier conviction modified, so
that the judgment’s description of the charge no longer
referred to “false and fraudulent income tax returns,” but
only to “wilful attempts to evade or defeat an income tax.”
We responded to that maneuver as follows:
The “order correcting clerical error in Judgement”
eliminating the description of the offense charged as
“making false and fraudulent income tax returns” may
technically take the judgment out of Class One [“crimes
necessarily involving moral turpitude”] described by Judge
Chambers in the Twentieth Century-Fox Film
classifications, but it does not take the crime as charged
out of Class One.
Id. (emphasis in original). Finally, we summed up our
decision as follows:
We follow the rule laid down in the De George case supra,
and Bloch v. United States, 221 F.2d 786 (9th Cir. 1955),
that an intent to defraud the government is a prerequisite
to conviction under section 145(b) and hence, a conviction
thereof where such fraud is charged in the indictment, is
conviction of a crime involving moral turpitude.
Id. at 936 (emphasis added).
We reiterated the rationale of Tseung Chu in Khan v.
Barber, 253 F.2d 547 (9th Cir. 1958). In that appeal, the
first question presented was whether a conviction for
violating section 145(b) involved moral turpitude. We
stated:
This court has already answered the first question
affirmatively where, as here, intent to defraud the
government is charged in the indictment and found by the
jury.
Id. at 549 (emphasis added). A quotation from Tseung Chu
immediately followed.
In my view, the rationale of Tseung Chu, reaffirmed in
Khan, is fatally inconsistent with any notion that the bare
crime of failing to file a tax return with intent to evade
taxes is ipso facto a crime of moral turpitude. If intent
to evade were sufficient to establish moral turpitude,
there would have been no need for us to examine the
indictments in Tseung Chu and Khan to make certain that
they charged fraud. The charges to which Carty pleaded nolo
contendere included no such allegation.
We did not diverge from the rationale of Tseung Chu in our
later decision of Goldeshtein v. INS, 8 F.3d 645 (9th Cir.
1993), Page 1087 discussed in the majority opinion here.
In Goldeshtein we held that the crime of structuring
financial transactions in order to avoid currency reports
was not a crime of moral turpitude. It is true that we
based our decision in Goldeshtein partly on the ground that
nothing had been taken from the government, but we also
based our decision on the absence of fraud or deception. We
pointed out that all of the cases upon which the government
relied involved “some false or deceitful conduct through
which the alien obtained something from the government.”
Id. at 649 (emphasis added). We then held that
Goldeshtein’s crime did not share this necessary
characteristic for a crime of moral turpitude:
The offense of structuring financial transactions to
avoid currency reports, in contrast, does not involve the
use of false statements or counterfeit documents, nor does
the defendant obtain anything from the government.
Id. at 649 (emphasis added).
Finally, I note the implications of the Supreme Court’s
decision in United States v. Scharton, 285 U.S. 518, 52
S.Ct. 416, 76 L.Ed. 917 (1932), which held that the longer,
six-year statute of limitations for “offenses involving the
defrauding or attempting to defraud the United States” did
not apply to a conviction for willfully attempting to evade
payment of taxes. It is true, as the majority opinion here
recites, that Scharton’s result depended in part on a
strict standard of construction applicable to the extended
limitations provision. Nevertheless, Scharton expressly
rejected the arguments presented by the government that
“fraud is implicit in the concept of evading or defeating”
and that “[a]ny attempt to defeat or evade a tax is said to
be tantamount to and to possess every element of an attempt
to defraud the taxing body.” Id. at 520-21. Although I
agree with the majority that Scharton is sufficiently
distinguishable that it does not directly control the
outcome of Carty’s case, Scharton certainly leans in the
same direction as Tseung Chu.
For these reasons, I respectfully dissent from the
majority’s opinion. I would grant the petition for review
and reverse the decision of the BIA.
[fn1] As the majority opinion here notes, California does
not require proof of fraud for conviction on this charge.
Majority opinion, supra, note 8.