Milton C. Grimes, a longtime Los Angeles attorney, was sentenced Tuesday to 18 months in federal prison for evading the payment of more than $7.2 million in federal and state taxes over more than two decades, according to the U.S. Attorney’s Office for the Central District of California.
Grimes failed to pay federal income taxes for 23 years, including the periods from 2002 through 2005, 2007, 2009 through 2011, and 2014 through 2023. The total amount owed, including taxes, penalties, and interest, amounted to $5,921,260.
The IRS attempted to collect the unpaid taxes starting in September 2011, issuing more than 30 levies on Grimes’ personal bank accounts. However, from at least May 2014 to April 2020, Grimes willfully evaded these payments by not depositing income from his clients into his accounts subject to levy. Instead, Grimes purchased approximately 238 cashier’s checks totaling $16 million to keep the money out of the IRS’ reach.
Grimes withdrew cash from his Interest on Lawyers’ Trust Account (IOLTA) and law firm accounts and regularly purchased cashier’s checks to hide his earnings from authorities. For instance, on December 5, 2018, Grimes deposited $1 million into his IOLTA account and immediately purchased nine cashier’s checks for the same amount.
“Despite being a respected attorney, Mr. Grimes made the deliberate decision to cheat on his taxes for decades,” said Acting U.S. Attorney Joseph T. McNally. “Tax fraud has a corrosive effect on society’s foundations, and we thank our partners at the IRS for their diligence in bringing this defendant to justice.”