A prominent Bel Air attorney and certified public accountant will begin serving six months of an 18-month sentence on Jan. 7, the date he must report to prison for his September conviction on income tax evasion charges.
Bernard P. Kole, 49, of the 600 block of Snowgoose Court in Havre de Grace, appeared Friday in federal court in Baltimore before U.S. District Judge J. Frederick Motz. Judge Motz suspended 12 months of the sentence.
The judge also ordered the defendant to serve two years of supervised probation after serving his time in prison and to pay all back taxes, plus interest and penalties, as assessed by Internal Revenue Service investigators.
Kole had pleaded guilty to failing to report income of about $283,000 between 1985 and 1987. The amount of tax owed for that period, not counting interest and penalties, was $78,000, prosecutors said.
Kole paid for a car, a computer, lawn services, a swimming pool and other goods and services by endorsing his clients' checks to pay for the items, thus bypassing his income accounting system, prosecutors said.
Additionally, Kole paid personal expenses from his business accounts without reporting the payments as income, cashed client checks received as payment for services and bartered legal and accounting services directly for goods and services without filing them through his system, prosecutors said.
Before entering private practice in 1983, Kole was chief of the Economic Crimes Division in the Baltimore City state's attorney's office, said prosecutors Joseph L. Evans and W. Warren Hamel, assistant U.S. attorneys. In the statement of facts, investigators said Kole filed false returns in 1985 and 1986, understating his business income by almost $50,000 and $118,000, respectively.
Kole originally had reported taxable incomes of approximately $27,000 and $65,000 for those two years. After he was notified that his returns would be randomly audited in the spring of 1988, Kole promptly filed amended returns, but only disclosed small portions of the previously unreported income.
Evidence showed Kole also failed to report about $51,000 of business income in 1987.
The investigation and prosecution was a joint effort by Lynne A. Battaglia, U.S. attorney for the District of Maryland, and Paul M. Harrington, district director of the Internal Revenue Service.
Kole operated his Bel Air office at 432 S. Main St. and practiced mostly in the Baltimore area.
He was legal counsel for Heather D & M Corp., which claimed it held an enforceable sublease to an Edgewood building occupied by Pulaski Highway porn shop U.S. Books, an offshoot corporation of Heather D&M.; The building's landlord, John P. Seisman, eventually won the battle to evict U.S. Books.