Key Democrat Pleads Guilty in Tax Case

Howard Owen Kieffer, a south county businessman who became a prominent county Democratic Party activist, pleaded guilty in federal court Monday to four counts of filing false income tax returns, authorities said.

Kieffer, 33, a marketing consultant who lives in Trabuco Canyon, was indicted by a federal grand jury in January on charges of defrauding the government of $212,000 in tax refunds.

He faces a sentence of up to 20 years in federal prison and a fine of up to $1 million. Sentencing is scheduled June 19 in U.S. District Court in Los Angeles.

At Monday’s court hearing, Kieffer, a convicted felon, admitted filing false tax returns and W-2 forms from two phony businesses, one in Los Angeles and the other in Anaheim, said Assistant U.S. Atty. Maurice A. Leiter.

Besides the guilty plea, Kieffer agreed to repay more than $212,000 to the government, Leiter said.

Investigators said Kieffer obtained genuine W-2 forms, filled them out with bogus salary information from the two businesses and attached them to his tax returns, reporting that portions of the salaries had been withheld and asking for a refund.

However, after an informant tipped off the Internal Revenue Service, an investigation determined that the businesses were phony.

Leiter said the Los Angeles business address used by Kieffer is nonexistent, and the Anaheim address turned out to be rooms Kieffer had rented in the early 1970s but had long since vacated.

Kieffer had been convicted in 1984 of two counts of felony grand theft for fraudulently buying airline tickets and illegally deeding himself a house that he used as collateral for a loan.

The actual owner of the home, a widow, was forced to give up the residence when the loan foreclosed.

County Democratic leaders had tried recently to distance themselves from Kieffer after the indictments and his previous convictions were revealed.

Kieffer was removed as an alternate on the county Democratic Central Committee and from a seat on the party’s committee for south Orange County’s 70th Assembly District.

He was also removed from the board of Orange County Democratic Associates, a Democratic support group, when he refused to resign in February.

Kieffer ran the Laguna Hills regional office that provided support services for the party’s presidential candidate, Massachusetts Gov. Michael S. Dukakis, and for other Democratic candidates.