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Mar-21-2011 04:20printcomments

THCF's Paul Stanford Arrested Al Capone Style

Oregon businessman and cannabis freedom fighter tries to set the record straight.

D. Paul Stanford
Paul Stanford will make his first appearance to take on the charges on March 21, 2011. Photo by Tim King

(PORTLAND, Ore.) - Every arrest of a lawbreaker makes a big difference to the state of Oregon- every dime collected, a huge relief to the tax payers. That’s what one would hope, that the powers-that-be had the best interests of we average citizens at heart.

That rose-colored version of life in Oregon is far off however, proven by the odd announcement recently by Attorney General John Kroger about his big catch of the day. That is, a local businessman that was late in filing two years of personal income taxes.

Filing late is not any more unique in Oregon than in other states, but it seems this particular late-filer was the straw that broke the camel’s back for Oregon’s top cop.

For the first time in Oregon history, our Attorney General made a special effort to boast about the arrest of someone who allegedly did not file personal tax forms on time.

Attorney General Kroger’s public audio announcement extolled a renowned citizen of Portland, (Douglas) Paul Stanford, saying he had been arrested on "tax fraud charges". Kroger explained that Stanford faces charges of 'Failure to File Personal Income Taxes' for the years 2008 and 2009.

Just the type of thing used to take down such notorious felons as Al Capone.

Still, this begs the question: don't citizens of the U.S. have any privacy rights? It seems not in this case. Knowing as we do that thousands of otherwise good and law-abiding citizens have outstanding tax forms and unpaid tax bills, it is curious that Attorney General John Kroger chose to make a public statement specifically about Paul Stanford.

Paul Stanford is no Al Capone. He is the founder and president of The Hemp and Cannabis Foundation (THCF) medical clinics, that has tended to tens of thousands of sick and ill patients in nine states, and has advocated the end of cannabis prohibition for thirty years.

He is also a Chief Petitioner for Initiative Number 9 (Oregon Cannabis Tax Act 2012) to reform Oregon's cannabis laws by regulating the legal sale of cannabis and allowing unregulated production of hemp fuel, fiber and food.

Stanford believes that the criminal case and the Subpoenas are motivated by a political goal to discredit him and his organizations, attempting to stop their work to lawfully change the laws and end prohibition of cannabis.

“The Oregon Attorney General made a public statement and issued a press release the day after my arrest with the title, ‘Hemp and Cannabis Foundation President Indicted on Tax Fraud Charges,’ and linked from the Oregon Attorney General's website with, ‘AG Kroger Announces Tax Fraud Arrest’,” Stanford said.

“Failure to file personal income tax returns is not fraudulent and does not constitute fraud. Due to circumstances beyond my control, I was unable to accurately file taxes and made arrangements with the US IRS regarding compliance which should have been sufficient for compliance with a request for an extension to file under Oregon's laws,” Stanford stated in the motion to dismiss.

“If I had filed tax returns that were purposely inaccurate, that would be fraudulent. One would expect the Oregon Attorney General and its legal staff to know the difference between the accusation of noncompliance and the accusation of fraud, however, the Oregon Attorney General has been publicly trumpeting this false allegation of fraud, thereby tarnishing the reputation of the Defendant.”

Bonnie King and Paul Stanford

“One of the prosecutors for the Oregon Department of Justice recently told our CPA that this case 'would set back our work to end cannabis prohibition',” Stanford said. “And I believe that this is an objective of the Oregon Department of Justice's case and is one facet constituting malicious prosecution.”

“These false allegations have been covered by numerous television and radio stations and published in dozens of newspapers, including the Chicago Tribune. Never before has the Oregon Attorney General ever issued a press release regarding a taxpayer's failure to file two tax returns, no less the two most recent returns.”

Stanford contends that the State of Oregon rushed to indict him with the full knowledge that he had been prevented from filing due to circumstances beyond his control and that the personal tax return filings would be made immediately forthcoming. Information needed for those two years had been challenging to assemble, due to the destruction of records by a past employee whom was fired for stealing. A complaint regarding the bookkeeper was filed in January (Multnomah County Case Number 11013035).

“I would like to see an investigation on how this all came about, that would be real justice,” Stanford said. In the Multnomah County Case, he states “individuals that likely are clandestine agents and/or officers directed by state and/or federal agencies are responsible for the destruction of Respondents’ financial records, and that this made Respondents' compliance impossible.”

They were about 60 days from completion when the DOJ moved to indict. “They knew I’d been doing everything, diligently, that I could,” Stanford said. “We were close.”

In early February, Stanford says a special investigator told him, “We know you’re going to file, but we’re still going to indict.” And so they pushed on, working to finish the taxes with a time clock ticking.

"They were fully aware of the situation, and that we have been working to locate missing information, recreate financial records that had been destroyed and comply with our duty to file tax returns," Stanford said. "This is absolutely a case of looking for a reason to arrest."

AG Kroger’s official announcement said Stanford's indictment and arrest followed an investigation by the Department of Justice's Charitable Activities Section and Criminal Justice Division, whose efforts culminated as part of "Operation Frogger".

"Operation Frogger" was described by Kroger as “an anti-drug campaign aimed at drug trafficking groups" in Oregon. It was a statewide sweep, involving at least 200 law enforcement personnel, and was dubbed a "major heroin raid" as police netted 22 suspects along with a total of 341.5 grams of heroin, 28.5 grams of methamphetamine and 22 grams of marijuana (less than one ounce).

In an unusual twist, the major heroin raid also included the capture of ...someone remiss in filing personal income taxes.

"In these tough economic times every tax dollar is crucial, and we cannot afford to let people cheat on their taxes," said Attorney General Kroger. Most people would not consider being late, “cheating”.

Paul Stanford's name is not even included on the list of 22 "Frogger" suspects arrested. The inference that Paul Stanford is somehow involved in drug trafficking is quite off-setting to his peers, clients, and anyone who has followed the success of the THCF clinics through the years.

"If they would have asked me to come in, turn myself in, I would have. But they had to create an event," Stanford said about the DOJ’s surprise arrival at his home. "Luckily they didn't arrest me in front of my children."

Once Stanford was plucked from his NE Portland home and taken 65 miles south to the Marion County Jail outside of Salem, he was booked on two counts of Failure to File Personal Income Taxes for 2008 and 2009. He then learned that the AG's office asked that $20,000 bail be assigned to him, which would mean $2,000 to get released. But Marion County didn't see fit to ask for any bail. He was released on his own recognizance.

Just over a week before Stanford’s arrest, his office received two Subpoenas from the Department of Justice. In response, last Friday he filed a motion in Marion County Circuit Court to “QUASH AND/OR LIMIT SUBPOENAS” on six main grounds.

First, the Subpoenas were not served upon an agent nor employee of THCF or CRRH, but upon an independent contractor and the Subpoenas are, therefore, invalid. When the Oregon Department of Justice special agent arrived and discovered that Douglas Paul Stanford was not present, the agent served the two Subpoenas upon a Certified Public Accountant contracted by THCF and CRRH to provide financial services, even after being told he was not authorized to accept service.

Second, the Subpoenas are overly broad and unduly burdensome, seeking tens of thousands of pages of documents, receipts and papers, with only two weeks given to comply.

Third, some of the documents to be produced are confidential records of medical patients' private information and therefore should be protected from discovery. In 2007, a federal grand jury subpoena was served upon THCF and Douglas Paul Stanford for patients' information. Ironically, the Oregon Attorney General's office joined in that case and the Chief United States District Court Judge ordered that this subpoena be quashed because it sought privileged patient information. The same protection of patients’ rights still stands.

Fourth, assuming that the scope of the Subpoenas was manageable, and the responsive documents not privileged, the timing of the Subpoenas and the short time frame for response make compliance impossible.

Fifth, compliance with these Subpoenas would violate defendant's rights under Article I, Section 12 of the Oregon Constitution and the Fifth Amendment to the United States Constitution against compulsory self incrimination.

Sixth, due to a lack of time and/or resources, retaining counsel to represent THCF, CRRH nor Douglas Paul Stanford, regarding this Subpoena nor the two criminal indictments mentioned in the Fifth grounds listed above has been impossible.

Stanford says he received no notification letter or phone call forewarning him of the possibility of arrest, and was surprised when it happened because he had complied with their wishes to the best of his ability while continuing communication with them.

"We have been in an ongoing audit since from the Oregon Department of Justice continuously since 2005. When I met with them recently, there was a stack of files over a foot thick on the table; two three-ring binders, all about me," he said. "Newspaper clippings and all kinds of stuff. They probably have invested six figures in this investigation, it’s a huge waste of money.”

And for what?

“This has been planned for several months, it’s no coincidence that it coincided with Kitzhaber taking office,” Stanford remarked. In early February, when he met at the DOJ’s office in downtown Portland, he was told his case had been “languishing, but there’s a renewed interest since the beginning of the year.”

Governor Kitzhaber signed the bill to recriminalize marijuana in 1997 to prove he was tough on drugs, and then watched as a petition drive heartily overruled his decision; and more recently Stanford and other pro-cannabis advocates endorsed Bill Bradbury for Governor, so there has been a lasting adversarial stance between them.

Although the statement released by the Attorney General lends a disclaimer to the action by noting that "Every criminal defendant is considered innocent until proven guilty beyond a reasonable doubt in a court of law", he left no question that his office is proud of this collar.

Theresa Stanford, who works with her husband Paul commented, "We both have put others first before 'paying ourselves' this is something the State of Oregon needs to examine, considering this is only about personal income tax. Nobody has gone to trial yet, so hold on to your seats we are in for a ride. They are going to be surprised at how self sacrificing Paul really is."

Paul Stanford is scheduled to be arraigned on Monday, March 21st in Marion County Circuit court. He is representing himself, pro se. He will file the motion that the Court dismiss the two charges of Failure to File Tax Returns based on the fact that since his arrest he has completed filing tax returns for both years and has paid the balance past due of $4,485.00 for 2008 and $6,043.00 for 2009, in addition to $2500 for 2010.

Senior Assistant Attorneys General Shannon Kmetic and Jennifer Gardiner are prosecuting the case for the Oregon DOJ.

The Oregon Department of Justice's mission is to fight crime and fraud, protect the environment, improve child welfare, promote a positive business climate, and defend the rights of all Oregonians. Including, one would hope, even the infamous Paul Stanford.

“I’m working for freedom, and that’s a risky thing to do,” Stanford said.


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For more Cannabis-related stories and factual information, go to: Cannabis De-Classified


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Publisher Bonnie King has been with Salem-News.com since August '04. Bonnie has served in a number of positions in the broadcast industry; TV Production Manager at KVWB (Las Vegas WB) and Producer/Director for the TV series "Hot Wheels in Las Vegas", TV Promotion Director for KYMA (NBC), and KFBT (Ind.), Asst. Marketing Director (SUPERSHOPPER MAGAZINE), Director/Co-Host (Coast Entertainment Show), Radio Promotion Director (KBCH/KCRF), and NIE/Circulation Sales Manager (STATESMAN JOURNAL NEWSPAPER). Bonnie has a depth of understanding that reaches further than just behind the scenes, and that thoroughness is demonstrated in the perseverance to correctly present each story with the wit and wisdom necessary to compel and captivate viewers. View articles written by Bonnie King

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Amanda March 31, 2011 1:20 pm (Pacific time)

We should remember more of John Kroger's administration, as the Appellate Judiciary is still adjudicating most of the cases by Administrative Assistants, amnd thne Oregon Department of Justice look on, while innocent people are robbed of their Rights to a fair judicial system, based on EVIDENCE, not prejudice and bias.


Silence Dogood March 25, 2011 2:24 pm (Pacific time)

As my own baby-boomer generation ages, suffers pain, slow deaths from cancer, excruciating arthritis, and all kinds of other medical maladies, the big 'pharma' manufacturers, private nursing homes, regular pharmacies,and non-profit or private hospitals are positioned for windfall revenues to keep their operations either solvent and "profit-driven".


Is it no wonder [THINK PROFITS] these health enterprises wish to keep the ill, and aging (future ill) people, dependent on such enterprises for medical treatment, products, and services?

A desire for MONEY and politics making strange bedfellows in this case involves policing agencies. POLICE agencies enjoy the fruits (illicit ones, too)of keeping marijuana dispensaries on their HIT LIST for busts as it can be very lucrative $$$$$.

Federal Law (and state) allows personal and real property confiscation in drug cases, creating a non-transparent revenue stream into law enforcement agencies, who may then convert said property (persona/real) seized or levied upon (THINK FAMILY HOME) with a lis pendens action.

The propaganda battle against marijuana at every institutionalized-level (government, private, law enforcement)is over traditional profit/market opportunities threatened by further legalization in this legal-medical arena of serving private individuals who are in pain and/or dying, and have "assets".



Dispensary Aquittal: Yakima March 25, 2011 1:59 pm (Pacific time)

http://www.yakima-herald.com/stories/2011/03/24/medical-marijuana-dispensaries-first-county-trial-ends-in-acquittal

PART OF THE ARTICLE:

"Hicks' defense called a half-dozen witnesses who said that they were either patients or authorized providers for patients. Hicks was described as a passionate advocate for medical marijuana who is continuing to take horticulture classes and is committed to the cause despite his legal problems."

YAKIMA, Wash. -- Yakima County's first trial over a so-called medical-marijuana dispensary or collective quickly ended in acquittal Thursday afternoon. Defense attorney George Hansen declined to comment in detail on the verdict, but he said he spoke with a few of the jurors, "who indicated that they needed to see more from the state." The jury returned its verdict in spite of the fact that Judge Rob Lawrence-Berrey prohibited testimony regarding a medical-marijuana card that Hicks said he possessed.

The Superior Court jury that heard the charges against Valtino Hicks of Yakima returned its verdict in less than 25 minutes, unusually quick for almost any criminal trial.

At least two other local cases are pending in which a medical-marijuana argument could be raised. [Yakima defense attorney Greg Scott, who is handling two other cases charged by county prosecutors in which he expects to make a medical-marijuana argument, said marijuana is the only legal drug for which a prescription is not a clear-cut defense.]

The issue remains controversial across the state at political and legal levels. King County has been the most visible in declining to prosecute marijuana dispensaries, and legislation advanced this week that would take steps toward creating a framework for legal dispensaries.

The Yakima County prosecutor's office offered no immediate comment on the verdict or whether the outcome of the Hicks case would affect prosecution policy.


Hazel March 23, 2011 10:02 am (Pacific time)

The irs is a zionist (jewish mafia) extortion racket as well explained in the article published at Veterans Today dot com, titled "The IRS Extortion of the American People". And of course they wouldn't want marijuana legalized. People using the same are not vulnerable to brainwashing. If you're not brainwashed, you aren't willing to be their slaves.


Cindy Pettit March 22, 2011 11:56 am (Pacific time)

I f you have ever had the pleasure of meeting Paul Stanford you would know he is not trying to get over on the tax man he just hase'nt gotten to it yet he is constantly paying taxes someone is trying to tarnish Pauls good name because all he does is help people and we are all very thankful but now he needs our help and I for one will do anything to help him and his Family because thats what he would do for me.He already has.He is not a tax evader quite the opposite.Paul sits with people while they are dying to comfort them could you see John Kroger doing that? me neither and Mr. Kroger or someone in his family might need Medical Cannibis one day,would they still be against it or would they go to Mr. Stanford for help? It's impossable to say but I think they would use our medicene if it made them feel better.Their is a 'SYMBOL OF EVIL


Leonard Krivitsky, MD March 22, 2011 10:05 am (Pacific time)

Current situation with cannabis/medicinal cannabis legalization shows that the dangerous philosophies of "radical pragmatism", shared by both Marxists and Nazis, are well and alive in contemporary America when it comes to anti-cannabis policies! The extremists currently in charge of the DEA will stop at nothing to derail the medicinal cannabis program and the Will of Voters who voted for it. I wish I could see the day when the senseless and shameful witch-hunts against citizens over a natural medicinal plant cannabis finally end, and they will! I predicted a long time ago that anti-cannabis repression will lead to increased hard drug and alcohol abuse because they are not "easily" detected in random drug screens, especially when it comes to the "window" of their detection. All these so-called "random drug screens" unfairly target the users of the safest substance of them all - cannabis! I can't wait to see the day when these shameful and senseless witch-hunts against citizens in connection with cannabis medicinal plant will stop altogether. I stressed many times already that no system, no matter of how repressive, can survive on a series of "un-realities". Current undisguised assault by the "radical pragmatists" from the DEA on the will of the people of Montana (and now also Hollywood) demonstrate their delusional thinking their attempts in suppression science (and people's will) will be more successful than those of Inquisition, Gestapo, or KGB! I wish I could live to see these people's miserable and disgraceful failure! Everything that the DEA and its allies use to intimidate citizens (and politicians) about the remarkable cannabis plant is based on unreality: cannabis is NOT physically addictive, the so-called "gateway drug theory" is NOT scientifically valid, smoking cannabis does NOT lead to increase in the risk of lung cancer, legalization in other countries did NOT lead to increased cannabis use, and in addition it is proven that cannabis use suppresses violent behavior. To claim that drug Marinol is the same as medicinal cannabis is to make yet another break from reality. Cannabis is immeasurably safer than alcohol, (and most currently used prescription drugs - do we even notice their devastating potential side effects at their TV commercials?), and be so ignorant as to say that cannabis plant does not have medicinal value is to be out of touch with "reality" altogether. Legalization of medicinal cannabis is non-partisan because all of us can get sick and be able to take advantage of its remarkable medicinal properties. Let's reject the prohibitionist fear-tactics as they have no substance to them, and legalize cannabis in all 50 States without further delay!


Colli March 22, 2011 6:19 am (Pacific time)

Hm-m-m-m . . . I wonder why Paul Sanford became a target but tax-cheats such as Timothy Geithner didn't. Geithner failed to pay personal employment taxes of $35,000 for the calendar years 2001 through 2004 but he wasn't arrested . . . he was made secretary of the treasury! It is obvious that Paul Stanford has been targeted as a result of his support for decriminalization of cannabis. Excellent article Bonnie!


Denver guy March 21, 2011 11:24 pm (Pacific time)

Mr. Stanford could sure pay his taxes off with the settlements from the LIBEL LAWSUIT(s) I sincerely hope he files!!!


Silence Dogood March 21, 2011 12:58 pm (Pacific time)

Over at “Blue Oregon”, a political blog of sorts, Kroger was recently discussed in a thread found here: http://www.blueoregon.com/2011/03/are-ag-krogers-hardball-tactics-over-line/
 

Jack Roberts writes, “Let me quote from Kroger's book”. Roberts  then provides a quotation, quite relevant to what Kroger is now doing to  Mr. Stanford.

Kroger wrote in his (Kroger's) book (per Jack  Roberts): "When Andrew Weissmann indicted Fastow in late 2000 . . . he did  not charge Fastow's wife or the other minor participants in the  scheme."

"Lea Fastow had knowingly signed the Fastow's fradulent joint tax  returns, but it was clear the moving force behind the crime was her  husband. Morevoer, tax evasion cases of this size ARE ALMOST NEVER  CHARGED CRIMINALLY. Instead, they are TYPICALLY SETTLED CIVILLY by the  IRS, with tax cheats paying back taxes plus a fine. . . ."

"Still, something about the idea of indicting Lea Fastow really troubled me (Kroger)."

"As  Leslie and the other prosecutors talked, I suddenly recognized what it  was--the KIDS. The Fastows had two small sons. If we indicted Andy and  Lea, their kids faced the prospect of growing up with both parents in  jail."

"What we were proposing, in essence, was to take those two KIDS HOSTAGE, a very ugly exercise of BRUTE GOVERNMENT POWER."

"One  of my fellow prosecutors made this clear at our meeting. He said,  'Let's see how Fastow feels about going to trial when his children are  in f***ing foster care. . . ."

"I expected the press would go berserk. In fact, NO ONE CARED.  ENRON was such a SYMBOL OF EVIL we could probably have shipped Lea off  to Guantanomo and no one would have objected. . ” (end Kroger quote)

Now, back to Jack’s comment about Kroger over at "Blue Oregon". Jack  wrote: “Let me point out, Kroger was a marginal player in all this and  had no decision making authority. I cite it because his book is an  excellent discussion of the MORAL ISSUES involving these DECISIONS. I'm  just questioning whether he (Kroger) learned the right lessons from  them.”

Well, Jack, I'd say Mr. Stanford is a case in point of what Kroger learned from the Fastow "tax" case.

HANG  EM' HIGH ON TAX EVASION CHARGES! When 'they' are a "SYMBOL OF EVIL" (or  political fodder for re-election) NO ONE WILL CARE if the 'cause' is 'polarized'. Kroger learned WELL  from the Fastow case, he learned that he can make his political  "Brownie Points" off a tax evasion case and medicinal "brownies"...  


Daniel March 21, 2011 8:18 am (Pacific time)

It seems John Kroger is using his office to create a high profile political stepping stone . We should remember his actions come next election .

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