‘Little People’ Find Hotel Queen Guilty of Tax Fraud : Helmsley Acquitted of Extortion
Hotel queen Leona Helmsley, who once boasted “only the little people pay taxes,” was found guilty today of federal tax evasion for hiding everything from the price of girdles to lush furnishings for her suburban mansion in company accounts.
The high-living Helmsley, 69, faces a possible three- to five-year prison sentence and fines ranging up to $7 million.
She and two associates, Frank Turco and Joseph Licari, were found guilty of tax evasion, aiding and abetting tax evasion, conspiracy to defraud the Internal Revenue Service and filing a false tax return.
Innocent of Conspiracy
The U.S. District Court jury of six men and six women that deliberated five days found Helmsley and Turco innocent of conspiracy to commit extortion, however, a charge that could have brought 20 years in prison.
Judge John Walker set sentencing for Nov. 14, with Helmsley remaining free on bail.
Helmsley’s husband, Harry Helmsley, 80, whose $5-billion real estate kingdom includes the Empire State Building, was indicted with her but was not tried because he suffers from severe memory loss. She is in control of the hotel empire that includes 21 hotels in 15 cities around the world.
The trial whipped up a storm of interest in New York and most public sentiment was against Leona Helmsley. Prosecutors portrayed her as a 20th-Century Marie Antoinette and a string of witnesses described her as haughty, harsh and hot-headed. Her own attorney even said people might regard her as a “tough bitch.”
Stingy Taskmaster
A parade of witnesses, including fired employees, described her as an overbearing, stingy taskmaster with a tongue like a rapier. Even Mayor Edward I. Koch got into the act, calling her “the Wicked Witch of the West.”
Helmsley was found guilty of 33 of 47 counts. Turco, 45, of Lutz, Fla.; and Licari, 51, of Oyster Bay, Long Island, were found guilty of 39 of the counts.
As the foreman read the long litany of charges, Helmsley remained impassive. Her grandson, Craig Panzirer, 18, and her niece, Fran Becker, were in the courtroom and after the verdict kissed her on the cheek. The trio then left the courtroom and made their way through the mob of photographers and reporters without comment.
The 47-count indictment charged that the Helmsleys evaded $1.2 million in income taxes in 1983, 1984 and 1985 by charging off $4 million in personal items, such as renovations and furnishings for their 28-room Dunnellen Hall estate in Greenwich, Conn., to their hotel and real estate companies.
$1-Million Pool Enclosure
The expenses included more than $1 million for a pool enclosure with a marble dance floor on the roof, jade figures worth $500,000, a $130,000 indoor-outdoor sound system similar to one Leona Helmsley had admired in Disney World and thousands of dollars in landscaping work.
The prosecution’s case was most of the show. It produced a former housekeeper at the Connecticut mansion who testified that Helmsley told her: “We don’t pay taxes. Only the little people pay taxes.”
A former Helmsley controller testified he was told by a superior that the only accounting system that worked was the “Helmsley cheat-the-government system.”
