Case 2:11-cr-00248-RSM Document 58

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The Honorable Ricardo S. Martinez

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE

UNITED STATES OF AMERICA,

v. TIMOTHY GARRISON,

) ) Plaintiff, ) ) ) ) ) ) Defendant. ) )

NO. CR11-248RSM GOVERNMENTS SENTENCING MEMORANDUM

The United States of America, by and through Jenny A. Durkan, United States Attorney, and Jill Otake, and Vincent T. Lombardi, Assistant United States Attorneys, hereby files this Governments Sentencing Memorandum in the above-referenced case. As outlined below, the government recommends a sentence of forty-eight months of incarceration, followed by a two-year term of supervised release. I. BACKGROUND FACTS A. The Discovery of Timothy Garrisons Involvement in the Sovereign Citizen Movement. Defendant Timothy Garrison (Defendant) first came to the attention of law enforcement in the instant case when the United States Marshals Service learned of

Governments Sentencing Memorandum- 1 No. CR11-248

U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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Defendants role as the national treasurer of a sovereign citizen organization.1 See Presentence Report (PSR) at 12. Specifically, United States Deputy Marshal Raymond Fleck, who had been investigating the sovereign citizen movement for judicial protection purposes, met with Raymond Leo Jarlik-Bell,2 a leader of the Thurston County Assembly, to learn more about the groups beliefs. Mr. Bell provided Deputy Fleck with a Powerpoint presentation regarding the sovereign citizens doctrine and advised him that the presentation had been prepared by Defendants wife, Carmen Garrison.3 Thereafter, Deputy Fleck contacted Mrs. Garrison, who advised him that she had a document that would make the fifty-slide Powerpoint presentation easier to understand. After this conversation, the Garrisons faxed a document to Deputy Marshal Fleck from the Garrisons business, 89th Street Management. The document was addressed to the Skagit County commissioners, was signed by Timothy-George Garrison, and claims to be a Complaint and Claim for Damages (the Complaint). See Attachment A. The Complaint alleges that the Mount Vernon Police Department unlawfully accused Defendant of driving with a suspended license, and reads, in part: Complainant reports the conduct complained of as violations of WA and U.S. criminal statutes cited herein and fully expects the arrest and prosecution of the actors against him. If they are not so prosecuted, immediately, Complainant will feel free to rip their front doors off, if The sovereign citizens movement to which Defendant belongs is known as the Assemblies on the Counties at Large. See PSR at 12. Several counties in Washington state have Assemblies. The Assemblies subscribe to the doctrine that the American government, created by the Founding Fathers, with a legal system the sovereigns refer to as common law, was at some point secretly replaced by a new government system based on admiralty law. Id. They further believe that judges are a part of the ongoing conspiracy that allows for the admiralty law system to remain in force, and that sovereigns are slaves to the government. Id. The Assemblies have an armed wing, called the County Rangers. Id. County Rangers are required to own firearms, and possess and display realistic looking badges and credentials. Id. Assemblies members often engage in tax-related fraud schemes, issue false financial instruments, and engage in real estate fraud, all crimes that they justify through their claim that the current government is illegitimate. Id.
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Mr. Jarlik-Bell is currently indicted in case number CR11-5407RBL.

Deputy Fleck will be submitting a statement to the Court outlining his interactions with the Garrisons, in response to a letter written by Defendant that inaccurately relates the interactions.
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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necessary, to arrest them as permitted by law, and to deliver them to federal authorities. Id. (emphasis added). In the Complaint, Defendant then cites to a state statute and United

States Supreme Court precedent to claim:

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As you can see, there is an abundance of ways I can invoke the right, the statutory right to arrest any felon within ten years and without a knock at the moment of my choosing at any location, and deliver them to authorities, state or federal, as a private individual, and that such will be deemed to be a good faith communication, a scenario I presume to be one which your judges seek to avoid. Id. (emphasis in original).

Concerned that what he received was an attempt by the Garrisons to seek implicit
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approval from the United States Marshals that the County Rangers could arrest officials
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in Skagit County, Deputy Fleck called Mrs. Garrison and invited her to talk with him in
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person. Deputy Fleck went to a meeting in Skagit County in late July 2010, which was
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attended by both Defendant and his wife. During the meeting, Mrs. Garrison admitted to
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faxing the Complaint to Deputy Fleck, because the Garrisons believed by doing so they
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were executing a good faith communication to the Marshals which, based on the
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Garrisons interpretation of the law, meant they could arrest public officials in Mount
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Vernon. During the meeting, Deputy Fleck repeatedly reiterated that the County Rangers
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were not a recognized law enforcement agency and could not arrest public officials. The
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following day, Deputy Fleck received a call from Mr. Bell, advising that Mrs. Garrison
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was upset about the meeting because Deputy Fleck had told them they did not have the
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authority to arrest people.

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B.
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Defendants Sovereign Citizen Associates Contrary to what Defendant has suggested to the United States Probation Office,

he has strong ties to other Assembly members currently or recently indicted in this
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district. The Court is well familiar with David Russell Myrland, and his case, CR1126

0057RSM. When special agents searched Mr. Myrlands home, they discovered, among
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other documents, an EXTRAORDINARY Writ of Probable Cause which was also

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Governments Sentencing Memorandum- 3 No. CR11-248

U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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discovered by Deputy Fleck to have been posted on a sovereign citizens website, www.wspsp.com, and which reads, in part: Until such time as taxing authorities provide a briefing of 26 UC [sic] 83 which does not rely upon an arbitrary exclusion of the value of personal services from the value of any money or property paid as Tax Court says is the standard, Americans can presume that any public servant who speaks to them, in Washington state, can be arrested on the spot and taken to the nearest Sheriff under suspicion of felony criminal conspiracy. See Attachment to Dkt. No. 28 at 41-42. This document was signed by Mr. Myrland and Defendant and names Washington State Governor Christine Gregoire. Id. at 41. It also claims to have been mailed to the Governor. Id. Defendant also has ties to Raymond Leo Jarlik-Bell, and to Kenneth Wayne (Kenny or Kenny Wayne) Leaming, currently charged in case number MJ11-5242. All three men were active members of the Assemblies movement in this district and attended meetings together. C. The Discovery of Defendants Tax Scheme.4 Since 1988, Defendant operated a tax preparation business from his home in Mount Vernon, Washington. Defendant was initially an Enrolled Agent, which means that he was allowed to act on behalf of the taxpayers he represented without the taxpayers presence. See PSR at 18. His status as an Enrolled Agent was revoked in 1993. During the five years preceding Deputy Flecks first meeting with the Garrisons, the Internal Revenue Service (IRS) had audited seventeen of Defendants clients, and determined that the average amount of back taxes owed by these clients was $20,000 per return. The IRS uncovered a pattern of fraudulent tax filings, that involved Defendant filing two sets of tax returns for his clients: the first set was a corporate tax return and the second set was a personal tax return. Defendant had advised his clients to create what amounted to shell corporations or corporations through which all income was funneled. The scheme involved the false declaration on individual tax returns that the Unless otherwise indicated, the facts in this section are derived from the Plea Agreement at paragraph 9.
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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taxpayer received only, typically, $1,000 per month of income from the corporation, when in fact, the taxpayer was paid much more. The corporate tax returns declared false expenses for the corporation, offsetting the corporations income. The net result of the scheme was to facilitate the illegal avoidance of taxes on the individual returns. An example of the scheme was uncovered in the tax returns of C.N. and R.N. (a husband and wife), and Neto, Inc. C.N. and R.N. were audited by the IRS in 2010. C.N. was and is a fisherman who works on commercial fishing vessels seasonally and does not have any employees. Approximately twenty years ago, Defendant advised C.N., who at that time was still a fisherman, to create a corporation. C.N. has informed the IRS that he never knew why he and his wife needed a corporation. The corporation that Defendant advised C.N. to create and assisted him in incorporating, is Neto, Inc. Neto, Inc.s corporate tax returns for 2007 and 2008, which Defendant prepared, were audited by the IRS. According to the 2007 tax returns, which Defendant filed on April 8, 2008, the corporation's expenses for 2007 totaled $116,000. One expense listed is a $89,000 "commission expense." As part of Neto, Inc.s 2007 tax return, C.N. filed a 2007 Form 1120S U.S. Income Tax Return for an S Corporation, which reported deductions totaling over $116,000, to avoid paying federal income taxes. Neto, Inc.'s tax returns for 2008 show gross receipts of $210,000. The expenses for 2008 are listed as $175,698. One of those expenses is again a "commission expense" in the amount of $151,167. On March 9, 2010, during an initial interview with C.N. and R.N., a Revenue Agent asked both of them and Defendant what the commission expenses were for. C.N. replied that he had no idea what the expenses were for and that he does not have any employees or subcontractors. Defendant stated he would research the expense and report back to the Revenue Agent, but never appeared on the date scheduled to substantiate the expenses. C.N. and R.N.s 2007 tax returns, filed by GARRISON, show that they owed
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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$325. Their 2008 tax returns, also filed by Garrison, show they owed $383. The audit revealed that, on April 8, 2008, Defendant, on behalf of C.N. and R.N., filed a 2007 Form 1040 U.S. Individual Income Tax Return, which failed to report income on line 12 of the tax return of over $100,000, for income earned by C.N., in order to avoid paying federal income taxes. After the audit, it was determined that C.N., R.N., and Neto, Inc. owed $88,244 in back taxes for 2007 and 2008. Defendants scheme, as described above, and as executed through the filing of over fifty false tax returns for a number of clients, resulted in a tax loss of between $2,400,000.00 and $2,500,000.00, as estimated by the government, though the exact figure is unknown. D. The Execution of the Search Warrant5 On June 30, 2011, agents served a court-authorized search warrant at Defendants residence in Mount Vernon, Washington. Defendant, who has prior federal convictions for Mail Fraud and Securities Fraud, admitted that there was a 16-gauge shotgun stored in the crawl space on the lower level of his home. Defendant also stated that he did not have any additional firearms, but that his wife might have a firearm in the house, although he was not sure if it was still there. During the search of the home, agents found seven firearms, and over 6000 rounds of ammunition, including hollow-point bullets. The firearms were found in various locations throughout the house, including in an unlocked cabinet in the laundry room, where two Glocks and fifteen boxes of ammunition were found. See Complaint, Dkt No. 1, at 8-9. Defendant was arrested for Felon in Possession. After his wife left the residence, vehicles bearing County Ranger license plates, were seen conducting surveillance on the agents searching the home. The Garrisons vehicles had similar license plates. During the search warrant, agents also found color copies of Defendants County

Unless otherwise indicated, the facts contained in this section are derived from the PSR at paragraphs 25 through 27.
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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Ranger credentials, with Defendants photograph and name.6 E. Procedural History On July 22, 2011, a Grand Jury returned an Indictment, charging Defendant with Felon in Possession of a Firearm. Dkt. No. 12. Thereafter, the parties reached an agreement, and an Information was filed, charging Defendant with two counts of Assisting in the Filing of False Tax Returns, in violation of Title 26, United States Code, Section 7206(2). Dkt. No. 54. Defendant entered pleas to the tax fraud charges on November 1, 2011. Dkt. No. 57. F. Defendants Post-Plea Behavior Since the entry of his Plea, Defendant has engaged in activity that suggests that he has neither abandoned his sovereign citizens beliefs, nor his hope to nefariously manipulate the tax code and the laws of the United States for some gain. A review of Defendants emails for just a single month period, from December 24, 2011 to January 24, 2012, sent from the Federal Detention Center - SeaTac, reveal the following: 1. Defendant Continues to Challenge the IRSs Authority

In several emails to his daughter April, Defendant urges her to contact the Directors Office for the Federal Register to find out whether the IRS has done their duty and complied with the requirements of the Register by publishing in the Federal Register all of the required documents and items as so listed in Title 5 Section 552. See Attachment B, Emails from FDC.7 2. Defendant Continues to Associate with Sovereigns to Engage in Schemes Based on the content of several emails Defendant sent to his wife, it is clear that

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Defendant is working with Kenny Wayne Leaming to consider a legal attack on the
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Deputy Marshal Flecks letter to the Court will address this fact.

Defendant makes such remarks in emails to April Garrison dated January 24, 2012, January 21, 2012, January 18, 2012, and January 15, 2012 (two emails). He also discusses the Federal Register in an email to Mrs. Garrison dated December 29, 2012.
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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authority of Article III courts. For example, in a December 29, 2011, email, Defendant writes, What are Article III courts and Article IV courts. Their difference and which one is supposed to be working my case. Kenny gave me some case law to look up and then write a habeas on it for the court. See Attachment B. Similarly, in a December 24, 2011 email, Defendant wrote, Working with Kenny on the Article courts and a flaw that might work. See Attachment B. Also in several emails, Defendant discusses the importance of finding Daves Dinars, presumably Iraqi Dinars that belonged to David Myrland. See Attachment B.8 Many people in the sovereign citizens movement subscribe to the belief that Iraqi dinars, which were significantly devalued during the recent war, will increase in value significantly. As a result, such followers of this belief have hoarded dinars, in the hope that they will one day become valuable, but are currently worth almost nothing.

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Defendant has Sought Notorious Tax Defier Publications

In numerous emails, Defendant asks his family to send him a copy of Code Breaker, perhaps one of the best-known tax defier publications. See Attachment B.9 In one email, he even surmises that the FDC may not allow him to have such a book and asks his family to therefore send him copies of it. See Attachment B, email sent on January 22, 2012. 4. Defendant Continues to Challenge the Federal Governments Authority to Serve a Search Warrant on his Home

In at least one email, Defendant writes, We have two trespassing signs in our driveway yet the Feds ignored these signs and trespassed anyway. Call and ask the sheriff if the Feds have the right to trespass onto our property without any permission from us.

See emails sent on January 22, 2012, January 21, 2012, January 18, 2012, January 15, 2012. See emails sent on January 22, 2012, January 21, 2012, January 18, 2012, January 15, 2012, January 4, 2012
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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See Attachment B, email dated January 15, 2012. G. Defendants Letter to the Court regarding the Skagit Valley Assembly

Defendant is expected to submit to the Court a letter regarding his involvement in the Skagit Valley Assembly. Much of the letter contains false statements regarding his interactions with Deputy Marshal Ray Fleck, and also claims that no activity has taken place concerning assembly matters since the fall of 2010. In fact, however, according to Deputy Marshal Fleck, the County Ranger license plates seen on the cars that were conducting surveillance on the agents who executed the search warrant in 2011 were Skagit Assembly license plates and, moreover, Defendant remained the Treasurer of the National Assembly until he was arrested. II. SENTENCING GUIDELINES AND THE PLEA AGREEMENT The Plea Agreement and the PSR calculate Defendants Total Offense Level in the same fashion: that Defendant has a Base Offense Level of 22, based on an agreed loss amount of greater than $1 million but less than $2.5 million. All the parties also agree that Defendant deserves a two-level increase to the Base Offense Level under Section 2T1.4, because Defendant was engaged in the business of preparing tax returns. Finally, because Defendant has accepted responsibility for the crimes to which he has pleaded guilty, he deserves a three-level decrease, resulting in a Total Offense Level of 21, and a Guidelines range of 37 to 46 months. With regard to the governments recommendation and Defendants appeal rights, the Plea Agreement states: [T]he government will recommend the Court impose a sentence within the consecutive maximum penalties for Count 1 and Count 2, and that, similarly, the government will recommend the Court impose a term of supervised release within the consecutive maximum supervised release terms for Count 1 and Count 2. The governments specific recommendation with regard to imprisonment will be that Defendant serve a term of four years. Defendant will not challenge the legality of this recommendation, nor appeal any sentence imposed within the consecutive maximum penalties for Count 1 and Count 2... Plea Agreement at 14.

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U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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III. RESTITUTION The parties have agreed that restitution in this matter is due in the amount of $95,626.58, which was the balance owing the United States Treasury for C.N. and R.N.s back taxes, interest, and penalties for the years 2007 and 2008 as of January 4, 2012. The parties have also agreed that Defendant should be liable for this amount joint and several with C.N. and R.N. IV. RECOMMENDATION AND REASONING The government recommends a sentence of 48 months, followed by two years of supervised release. Examination of the Title 18, United States Code, Section 3553 factors reveals that the sentence recommended is appropriate. A. The nature, circumstances, and seriousness of the offense warrant a forty-eight month sentence.

Defendants tax scheme was extensive and prolific; he filed over fifty false tax
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returns resulting in a tax loss of between $2.4 and $2.5 million. See Plea Agreement at
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9. Defendants crime victims arguably include more than just the IRS and the United
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States Treasury. While some of Defendants clients aimed to outsmart the IRS, some
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of his clients, like C.N. and R.N., who are not originally from the United States, followed
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his advice naively, and as a result now owe an enormous amount of debt to the
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government. Defendants impact on such clients financial livelihoods and, similarly,

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their daily stresses, is indescribable. Finally, in the course of representing the clients who
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were audited, Defendant verbally abused and harassed ordinary employees of the IRS
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who were simply trying to do their jobs. He became a well-known thorn in the side of the
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Everett IRS office, and had to be kicked out of their facility for his aggressive behavior
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on more than one occasion.

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Any sentence less than forty-eight months does not recognize either the
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seriousness of Defendants crime, nor the impact it had on his victims.

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Governments Sentencing Memorandum- 10 No. CR11-248

U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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B.

The history and characteristics of Defendant demonstrate the need for a forty-eight month sentence to protect the public.

Defendant has not lead a law-abiding life; rather he has had a history of trying to illegally manipulate others, as well as federal and state laws, to his benefit. That history began in the late 1970s, when Defendant engaged in Mail Fraud and Securities Fraud by conning people into investing money into a cattle ranch scheme that resulted in significant losses to the people who trusted him. See PSR at 45-48. Defendant was sentenced to eighteen months of custody for those federal crimes. Thereafter, he opened his tax preparation business, 89th Street Management, where he prepared taxes as an Enrolled Tax Preparer, and continued to falsely represent to his clients that he was an Enrolled Tax Preparer, even when his status as an Enrolled Tax Preparer was revoked. He operated his tax preparation business since 1988, and the business finally crumbled after the charges in the instant case were filed. Defendants tax schemes went hand-in-hand with his sovereign citizen ideology; Defendant believed that the government had been taken over illegally, and was illegally taxing its citizens. While there is nothing wrong with having these beliefs, and even espousing them, Defendant crossed the line repeatedly by not only engaging in his tax scheme, but by threatening public officials, and filing liens on the homes of public officials in Skagit County liens that remain on the record to this day, and which have seriously impacted some of those public officials abilities to conduct common financial transactions. Defendants membership in the County Rangers, and his role as the Treasurer of the national sovereign movement, demonstrate how his activities in the movement were more than just a dalliance: they went beyond the pale. Defendants emails within the last 45 days illustrate his ongoing motivation to challenge the authority of the government to tax, and the authority of the Courts to execute the laws of this country. While challenges to authority are welcome in this country, Defendants ongoing crusade to pinpoint illegalities in the IRS and, now, apparently, Article III Courts, are highly concerning in light of his conviction for tax
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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fraud, and his blatant threats to public officials. Simply put, Defendant has not forsaken the very belief system that motivated him to engage in his crimes, and caused him to commit serious acts such as threatening to kidnap public officials. As a result, he remains a threat to both the sanctity of the tax system and to government workers of all levels. A forty-eight month sentence is necessary to meaningfully protect the public from Defendant. C. A forty-eight month sentence will deter Defendant and other likeminded individuals from committing crimes against the government and its officials. Defendants sentence will be heard throughout the sovereign community. A fortyeight month sentence will send the right message that tax defier schemes are taken

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seriously, and that there is a serious price to pay by engaging in them.

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Defendant himself is less likely to re-engage in a criminal lifestyle if a significant

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sentence is imposed. Defendant will be less inclined to commit similar crimes in the
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future, and risk further time away from his family, if he receives a meaningful sentence of
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forty-eight months.
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D.
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A forty-eight month sentence would avoid unwarranted sentencing disparities.

Defendants associate, client, and friend, David Russell Myrland, received a fortyeight month sentence for threatening to kidnap the mayor of Kirkland, Washington. Defendant and Mr. Myrland were both members of the sovereign assembly movement, and their beliefs motivated them to threaten public officials and engage in tax defier schemes. The difference between the two is that Defendant held important offices within the movement, and the fax he sent to Deputy Fleck, which threatened public officials with arrest, did not cross state lines and was therefore not chargeable as a federal crime. Moreover, Defendants tax scheme far bypassed Mr. Myrlands attempts to game the IRS. Finally, unlike Mr. Myrland, Defendant had felony convictions at the time firearms and thousands of rounds of ammunition were found in his home. // //
U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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Any sentence less than forty-eight months for Defendant then, would result in a sentencing disparity, and would not recognize the enormity of Defendants criminal behavior. III. CONCLUSION Defendant must be held accountable not for his belief system, but rather for the illegal behavior that arose from those beliefs. The forty-eight month sentence recommended, followed by two years of supervision would serve not only to appropriately punish Defendant for the significant damage that resulted in the course of his tax scheme, but also to deter others from engaging in such schemes and, perhaps most importantly, to protect the public and its officials from Defendant. The government respectfully submits that sentence recommended is both warranted and just. DATED this 26th day of January, 2012. Respectfully submitted, JENNY A. DURKAN United States Attorney s/ Jill Otake JILL OTAKE Assistant United States Attorney 700 Stewart Street, Suite 5220 Seattle, WA 98101-1271 Telephone: (206) 553-4254 Fax: (206) 553-0755 E-mail: jill.otake@usdoj.gov

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U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970

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CERTIFICATE OF SERVICE I hereby certify that on January 26, 2012, I electronically filed the foregoing with the Clerk of Court using the CM/ECF system which will send notification of such filing to the attorney(s) of record for the defendant(s). I hereby certify that I have served the attorney(s) of record for the defendant(s) that are non CM/ECF participants via United States Postal Service. s/Ashley Sturgis ASHLEY STURGIS Legal Assistant United States Attorneys Office 700 Stewart Street, Suite 5220 Seattle, Washington 98101 Phone: 206-553-4222 Facsimile: 206-553-0755 E-mail: Ashley.Sturgis@usdoj.gov

Governments Sentencing Memorandum- 14 No. CR11-248

U N ITED STATES ATTO R N EY 700 Stew art Street, Suite 5220 Seattle, W ashington 98101-1271 (206) 553-7970