In this archive photo, Attorney Jill Moran leaves the federal courthouse in Scranton after testifying at the trial for former Judge Mark Ciavarella on corruption charges. Times Leader File Photo Two weeks after Robert J. Powell pleaded guilty to tax evasion, his former law partner Jill Moran has pleaded guilty to failing to pay individual income taxes in connection with substantial legal fees she earned, law enforcement officials announced Wednesday.
Powell had served an 18-month prison sentence for his role in the “Kids for Cash” scandal.
Moran was not charged in the corruption probe but resigned as county prothonotary in March 2009 as part of an agreement with federal prosecutors.
A 55-year-old Conyngham resident, Moran appeared in federal court Wednesday to enter a guilty plea to a three-count criminal information charging her with not paying individual taxes for 2016 through 2018 on legal fees she received as the owner and operator of The Powell Law Group and a member of a mass tort litigation trust advisory committee, according to Wednesday’s announcement from the U.S. Attorney’s Office for the Middle District of Pennsylvania and the Department of Justice Tax Division.
The trust advisory committee stemmed from environmental litigation involving the former Kerr-McGee Corp. railroad tie manufacturing facility in Avoca.
Moran was released on an unsecured bond while awaiting her sentencing, the announcement said.
The maximum penalty under federal law is one year in prison for each failure-to-pay count, a term of supervised release following imprisonment, a fine and restitution.
According to the release based on court documents and statements made in court:
Moran did not pay individual income taxes on approximately $1.215 million she received in 2016 or on substantial income in 2017 and 2018.
In total, Moran caused the Internal Revenue Service to lose between $250,000 and $550,000 in taxes.
Moran became the managing director and president of the Powell Law Group in 2009, when firm founder and owner Powell was suspended from practicing law and ultimately disbarred.
When Moran took charge of the firm, Moran and Powell agreed Powell would collect 90% of any future fees the firm earned after paying expenses, while Moran would receive 10%.
“Running a business is not a license to avoid paying taxes,” IRS Criminal Investigation Acting Special Agent in Charge Denise Leuenberger said in the announcement. “Moran’s misconduct by not reporting her income cheated all Americans, since we all pay our fair share for the government services and protections that we enjoy.”
The cases were investigated by the Scranton office of the IRS Criminal Investigation Division.
Senior Litigation Counsel Phillip J. Caraballo, Tax Division Trial Attorney Alexandra Fleszar and Criminal Division Chief Bruce D. Brandler are prosecuting the cases.
Powell, 65, of Palm Beach, Fla., was also released on an unsecured bond while awaiting his sentencing. Federal agents said Powell sought to evade a substantial tax that was due to the IRS for 2016 by using nominee bank accounts, causing an accountant to file a request for a filing extension that falsely reported zero estimated tax liability for 2016, and making false statements during an IRS audit in 2019.
As alleged by the government, Powell received millions in income resulting in substantial taxes that were due but not paid.
In the plea agreement filed with the court, Powell agreed to pay full restitution to the IRS in an amount to be determined by the court at a later date. In his case, the maximum penalty under federal law is five years of imprisonment, a term of supervised release following imprisonment, a fine and restitution.
Powell had served a prison sentence for failing to report the $2.8 million “Kids for Cash” kickback scheme, which involved former county judges Michael Conahan and Mark Ciavarella and two juvenile detention centers Powell had co-owned.
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