Son of domestic terrorist sentenced to prison for tax fraud
By Guillermo Contreras | San Antonio Express-News | Published: August 22, 2014
SAN ANTONIO (MCT) — The son of a domestic terrorist was sentenced Thursday to 90 months in federal prison and ordered to pay $162,857 in restitution for dodging taxes.
Daniel Isaiah Thody, 46, was initially investigated on suspicion he was involved with some of the same domestic extremist groups as his dad, Walter Thody, 75, but he eventually was charged with evading taxes stemming from military contracts he obtained.
Daniel Thody, who was in the Air Force and had received training on building aircraft parts, was convicted at a trial last year of using a company his father created to produce anti-government publications, WET Publishing, to get 117 military contracts totaling $1.8 million from 2005 to 2011, for which he failed to file tax returns. Prosecutors believe the younger Thody's military background helped him land the contracts to provide aircraft parts.
At his trial, testimony showed he told undercover FBI agents he was out to rob the government and that he spent his time sharing anti-government sentiments online.
The IRS' Criminal Investigation Division investigated him for the tax allegations. In 2010, authorities obtained a search warrant allowing them to monitor communications between Thody and his imprisoned father, a believer of the racist theology known as Christian Identity and a leading proselytizer of the Phineas Priesthood, a violent credo rooted in an interpretation of biblical vengeance.
Walter Thody is serving life in federal prison in California for a series of bank robberies aimed at financing organized, anti-government crusades. He said in interviews with media outlets in the 1990s that bank heists, killings, bombings and other acts of crime and violence can be justified if they are committed to avenge a transgression against God's law or the U.S. Constitution.
Assistant U.S. Attorneys Mark Roomberg and Bill Harris argued that Daniel Thody used another relative's bank account to funnel payments from the contracts to hide the income as part of the tax-dodge scheme.
During sentencing, Daniel Thody said he did not believe the tax laws applied to him or that U.S. District Judge Orlando Garcia could sentence him.
He claimed the government was selective in its prosecution and failed “to find anything from a domestic terrorism investigation, and is still trying to salvage something from its investigation” by charging him with tax evasion.
He also sought leniency, saying he tried to cooperate with the IRS (which the agency denied), that he was involved in youth groups through an area church and that supporters would write letters to the judge on his behalf (no one did). He also accused the prosecution of withholding exculpatory evidence, and that he had ineffective assistance of counsel.
Thody represented himself at the trial and sentencing.
“I still believe I'm not subject to the (tax) code,” Thody told the judge. “I will fight for the freedom of the mind, and against those who try to destroy my freedom of mind ... I do not recognize this court's authority.”
In sentencing Daniel Thody, the judge gave him 45 months each for two counts, then stacked them. He gave him 41 months on each of the remaining three counts, but ran those concurrently.
“We have things like journalists being murdered,” Garcia told Thody, referring to the beheading of a reporter in the Middle East by extremists. “We spent so much time quibbling over this. You ought to 'fess up to what you did, and move on.”