Illegal Alien Prospers, Owes $22 Million in Back Taxes

By David North on June 27, 2014

Illegal aliens are typically portrayed as poverty-stricken, and many of them are.

Then there's Lee Ang.

A federal court earlier this year declared he owed about $22 million in back taxes and interest, and that was just for the tax years 1998-2001.

Lee Ang, the illegal in this case, is not to be confused with Ang Lee, the movie director.

I am not arguing that Ang is typical, but one should not assume that all illegals are poor, nor that all illegals are careful with their tax payments. His story is instructive about the ponderous ways that the bureaucracy moves under such circumstances, and the ability of some people to outwit the feds for decades at a time.

While the Treasury Department is at least on the case, there is nothing in the decision of the U.S. Tax Court to indicate that DHS has moved to deport this multimillionaire.

Ang's immigration story is not uncommon, unlike his ability to manage investments and his skill, until recently, to outfox the IRS, both of which are remarkable.

According to an IRS document quoted in the decision of Senior Tax Court Judge David Laro, Ang is a "joint citizen of Singapore and Belize", an interesting combination. Presumably he was born in Singapore and subsequently secured naturalization in Belize; the opposite sequence would be highly unlikely. (We have written before about Belize and its loose management of its own immigration laws.)

Ang came to the United States as a tourist with a B-1 visa, subsequently exchanged that for an F-1 and secured an MBA, and then morphed into an H-1B. He then filed for a green card, but his petition was rejected and he became an illegal. His lawyer tells that part of the story a different way, again according to the decision: "At trial petitioner [Ang] claimed that he chose to abandon his permanent resident alien application because of the negative tax consequences of becoming a permanent resident of the United States." (Emphasis in the original.)

The financial story is that Ang, with $11,000 borrowed from an uncle, managed to build that to $20 million after a few years, apparently through stock trading. Ang then proceeded to hide his assets under the names of family members and to report very little income for tax purposes because — and this is creative — he worked out a deal with his overseas (and-thus-free-of-U.S.- taxes) uncle that he, Ang, would take only 7 percent of the profits, giving 93 percent to his uncle in return for the $11,000 loan. Other brokerage winnings were hidden in other ways. Ang, however, controlled spending from his uncle's bank accounts.

The judge solemnly considered the 7 percent / 93 percent story, concluding "We are convinced that no economically rational actor dealing at arm's length would assign 93 percent of his substantial trading profits to another person ... in exchange for the forgiveness of an $11,000 debt."

The judge concluded that the IRS was right, that Ang owed the $22 million in taxes, and that the agency should move forward to collect that sum.

I wonder, did he send a copy of the decision to DHS? He should have done so.