A federal prosecutor told jurors Thursday that Estes Park resident Marcie Predmore and three co-defendants knowingly participated in an abusive trust scheme designed to help clients evade federal taxes despite repeated warnings that the arrangement violated federal law.
Closing arguments in the five-week trial concluded shortly after 4:30 p.m. in U.S. District Court before Judge Regina M. Rodriguez after a full day of presentations from prosecutors and defense attorneys. Deliberations began this morning, and jurors requested to be released at 4:15 today. They will return to the Alfred A. Arraj United States Courthouse in Denver on Monday to resume their work.
Predmore was indicted in September 2023, along with her husband, Timothy McPhee, in connection with what prosecutors describe as a nationwide trust-based tax shelter scheme. McPhee pleaded guilty last year and was sentenced in December to 151 months in federal prison.
Predmore is on trial alongside Roderick Prescott, Suzanne Thompson, and Weldon Wulstein. Prosecutors allege the defendants conspired to market and operate trusts that concealed income from the Internal Revenue Service and allowed clients to deduct personal expenses improperly.
“What did these defendants know? When did they know it? And after they gained that knowledge, what did they do?” John Patrick Burns, an attorney with the U.S. Department of Justice Tax Division, asked jurors during the government’s closing argument.
Burns argued that the evidence showed the defendants were repeatedly warned that the trust structures they promoted violated federal tax law, yet continued to sell and service them.
According to prosecutors, promoters recruited clients and sold trust packages, while bookkeepers and tax preparers maintained records and filed returns necessary to sustain the scheme.
“You just take from one pocket your assets, move them to the other pocket, and that way you don’t have to worry about IRS collections,” Burns said. “That’s tax evasion.”
Burns told jurors that prosecutors were not required to prove a formal agreement among the defendants, only that they knowingly worked toward a common unlawful objective.
A significant portion of the government’s presentation focused on Predmore’s personal finances and her role in Private Banking Concepts, the company through which prosecutors say abusive trusts were marketed.
Burns highlighted evidence showing Predmore earned hundreds of thousands of dollars through business activities, including her life insurance business, Mountain Solitude LLC, while allegedly failing to pay federal income taxes between 2016 and 2021.
“She earns, she makes money, and she doesn’t pay any tax on it,” Burns said.
Prosecutors allege Predmore and McPhee created four trusts, opened bank accounts in the trusts’ names, assigned nearly all of their income to those entities, and used trust funds to pay personal expenses, including utilities, insurance premiums, credit card bills, homeowner association fees, and investment purchases.
The government also pointed to emails and text messages that prosecutors said showed Predmore referring clients into the trust system and directing them to Thompson and Wulstein for bookkeeping and tax preparation services.
Defense summation arguments
Defense attorneys countered that prosecutors failed to prove their clients knowingly joined a criminal conspiracy.
Nina Marino, attorney for Wulstein, described her client as a longtime small-town certified public accountant who had no reason to believe the returns he prepared were part of an illegal scheme.
“Wulstein is surely not a criminal,” Marino said. “He did not willfully prepare false tax returns and risk his license, his livelihood, his family, his reputation.”
Attorney Evan Davis argued that Thompson, a professional bookkeeper with three decades of experience, built a reputation for honesty and integrity.
“She’s trusted with her church’s finances,” Davis told jurors. “This is the same person who apparently just woke up one day and said, ‘You know what, I think I’m going to go defraud the government?’”
Davis repeatedly characterized Thompson as “trustworthy” and “honest,” arguing that prosecutors had failed to prove criminal intent.
Laura Suelau, representing Prescott, challenged the government’s assertion that her client was connected to the alleged conspiracy and urged jurors to focus on the evidence presented in the current case rather than Prescott’s prior tax-related convictions.
In 2009, Prescott, who uses the alias Rick Scott, pleaded guilty to tax evasion and admitted to evading at least $550,000 in personal income taxes in connection with a nationwide promotion and sale of abusive trusts, which the IRS called a Ponzi scheme.
As part of the agreement, he was permanently barred from selling trust schemes that falsely claimed that customers’ personal expenses could be paid through a trust to obtain tax benefits not available to individuals. Suelau told the jury that Prescott’s past was not at issue in the case before them and that they needed to return a verdict of not guilty.
Predmore’s attorney, Laura Menninger, argued that her client, a former hairdresser who grew up in Estes Park, had “trusted too much.” She said Predmore had acted in good faith and relied on others she believed were trustworthy, including scheme founder Larry Conner, her husband, and various financial professionals.
“Trusting too much is not a federal crime,” Menninger told jurors.
Menninger acknowledged that Predmore participated in “Secrets of the Elite” seminars that promoted the bogus trust structures, but argued that Predmore’s role at the seminars was to hype up the crowd and that Predmore genuinely believed the arrangements were legal.
Rebuttal
In the government’s rebuttal, Justice Department attorney Lauren Pope reviewed evidence against each defendant and urged jurors to apply common sense when evaluating the competing narratives presented during the trial.
“You know whether someone is telling you the truth or whether they’re misleading you,” Pope said.
The trial stems from allegations that the defendants marketed abusive trusts that falsely promised business owners they could legally eliminate taxes on most of their income while shielding assets from IRS collection efforts. Prosecutors contend the defendants knowingly operated the scheme for years despite repeated warnings from tax authorities and court actions identifying such trusts as abusive.
If convicted, Predmore could face up to five years in prison on conspiracy charges. Additional tax-return preparation charges carry potential three-year sentences, and tax evasion counts carry potential five-year prison terms.
When jurors received final instructions from Rodriguez on Wednesday, they were reminded that the government bears the burden of proving each charge beyond a reasonable doubt.
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