Woman gets probation for under reporting ‘gold parties' income

A former Macomb Township woman who under reported income from "gold parties" received a lenient sentence that her defense attorney says was deserved.

Jennifer Lee Moriarity, 46, was sentenced by Judge Paul Borman of U.S. District Court in Detroit on April 25 to one day in jail, which she already served, $45,000 in restitution that she can pay over the next 37-1/2 years at $100 per month, and one year probation.

She pleaded guilty in September 2014 to aiding in preparation of a false tax return for failing to report to the IRS $173,500 in profit from 2008 through 2010 from buying and selling gold and other precious metals that would have resulted in $45,000 in taxes

In that time, Moriarity, a Grosse Pointe native, reported $1.1 million in total receipts instead of $2.9 million in actual receipts on which federal investigators said she earned a 6 percent profit.

The revenue came from dozens of gold parties she and her then-husband held at their home during which they purchased precious metals from friends, relatives and others and resold them to a metal refinery, Northern Refineries in Farmington Hills.

Judge Borman punished Moriarity below the advisory sentencing range of 10 to 16 months in prison.

Moriarity's attorney, Michael Rataj, successfully argued for a light sentence partially based on Moriarity's then-husband being charged but avoiding conviction. Rataj says in a court document his client was forced to absorb the brunt of the legal ramifications while her ex-husband "has been given a free pass" by federal prosecutors even though he was actively involved in the operation.

"With all due respect, this is a most unjust situation," Rataj wrote in an October 2015 letter to U.S. Assistant Attorney Stephen Hiyama.

Her ex-husband attended the parties, collected metal, took the metal to a refinery and received checks for it, although he was involved to a lesser extent than Mrs. Moriarity, attorneys said. Both Mr. and Mrs. Moriarity provided financial records to an accountant who filed their tax documents, attorneys said. The business was the couple's sole source of income during most of the time period.

The couple, who have two children, married in 2001 and divorced in 2012, records say.

In his sentencing memorandum, Hiyama acknowledges Mr. Moriarity's secondary role but says, "The gold business was defendant's, not her ex-husband's, and she was responsible for maintaining its records.

"In sum, this was a classic judgment call, and the government simply exercised its broad discretion in making its decision."

Rataj agreed with Hiyama's assessment that Mrs. Moriarity maintained sloppy and incomplete records.

He said his client was remorseful and cooperated with authorities, including testifying in front of a grand jury, while Mr. Moriarity did not cooperate.

Hiyama says in his memo the sentence should send a message to "reflect the seriousness of the crime of tax fraud" and deter others from it, saying the U.S. Treasury "loses hundreds of billions of dollars every year" due to tax fraud.