IRS probe leads to indictments of asset protection group

It turns out William S. Reed’s "bulletproof" plan to help clients conceal assets from the government through Nevada’s ultra-liberal limited liability corporation laws might not be made of Kevlar after all.

Reed, Richard Neiswonger, and Wendell Waite are three key figures indicted this week on federal charges of defrauding the U.S. Government, mail fraud, wire fraud, conspiracy and money laundering in connection with an IRS Criminal Investigation probe.

The IRS investigation was assisted by the publication of Reed’s own book allegedly outlining what the government alleges is a scheme to hide assets and avoid paying taxes. The defendants used a company called Asset Protection Group (APG.)

"From on or about October 23, 1998, and continuing through at least July17, 2006, APG offered, endorsed, marketed, and profited from a scheme to defraud which included the sale of three interrelated products, including: a) disguised corporate ownership services with associated bank accounts; b) fraudulent so-called 'friendly liens' of encumbrance generated without consideration; and c) consultant 'business opportunities' to sell these fraudulent products on behalf of APG to the public."

The indictment alleges Reed created more than 2,000 companies using the fraudulent scheme.

Nevada’s incorporation laws are considered some of the most liberal in the country. In addition, Reed’s company left little to the imagination, especially promising customers concealment from all authorities, even under oath in a courtroom.