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Opinion

What the Devil won't tell you

When Keith Bee's 19 bedrooms make for an 'indigent' defendant

Former Pima County Justice of the Peace and one-time Arizona state lawmaker Keith Bee got sentenced last week to six months in federal prison for tax fraud.

Let’s take a look at his sentencing order handed down by U.S. District Court Judge James Soto:

“IT IS THE JUDGMENT OF THIS COURT THAT the defendant is committed to the custody of the Bureau of Prisons for a term of SIX (6) MONTHS, with credit for time served. Upon release from imprisonment, the defendant shall be placed on supervised release for a term of ONE (1) YEAR.

“IT IS ORDERED that all remaining counts are dismissed on motion of the United States.

“The defendant shall pay to the Clerk the following total criminal monetary penalties:"

"RESTITUTION: (See below)The defendant shall pay restitution to the IRS in the amount of $214,414 plus interest of $128,719.05 as of 8/19/2021, for a total of $343,133.05 for tax years 2011, 2012, and 2013.

"The Court finds the defendant does not have the ability to pay a fine and orders the fine waived.

The defendant shall pay a special assessment of $100.00 which shall be due within 90 days from …” 

RRRRRT. Whoa, whoa whoa … back up, Sparky.

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The fine is waived? What? All of it? The crime he was found guilty of carries a maximum $250,000 fine. He couldn't pay that? He couldn't pay half that? Not even $50,000?

Turns out, no. Every dime of any fine Bee might pay was waived by the court. He has to do a jail sentence but the fine was waived. Since when is this an either/or thing? Convicts are released all over the country under the burden of fines that dog them for years.

Lady Justice may be blind but she can smell money. And it’s once again clear, she smiles more on those with than those without.

Crime and punishment

Let's start with Bee's crime.

He was charged with three counts of filing false information on his tax forms and one count of impeding an investigation.

Specifically, Bee overstated business deductions that reduced the profits of his company, Bee Line Transportation. Cars he claimed were for business, he later admitted during a plea agreement were actually for personal use. By "cars" I mean six Ford Mustangs, two Corvettes and a 911 Porsche Carrera.

Bee ain't an F-150 Republican, apparently.

The plea agreement gave the court the ability to sentence Bee to anywhere from 0 to 10 months in prison and a maximum fine of $250,000 on top of the restitution.

Assistant U.S. Attorney David Zipps said Bee's dishonesty is "what truly resonates" in large part because he was elected to a position of public trust.

"Keith Bee was a wealthy man who worked as a judge and owned a bus company that had multi-million-dollar gross receipts during the years in issue," Zipps said. "And despite his willingness to take taxpayer money to provide school bus transportation in Tucson and around the state, he refused to pay his fair share of the taxes he owed on the profits he made."

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Bee got six months and has to pay restitution of $343,133.05, but no fine. 

Asset non-forfeiture

He can't afford to pay it, the court ruled.

It’s not like Bee owns “a five-bedroom, four-bath 4,100-square-foot home on three acres across the street from Saguaro National Park East, with an assessed full cash value of just shy of $1 million.”

I mean sure, he might be able to afford to pay a fine if he had in his personal portfolio a “a seven-bedroom, five-bath residence set on eight acres, with an assessed full cash value of about $900,000. That home — with a 2,800-square-foot main house and a 1,200-square-foot guest house — features an indoor pool, along with garages with 20 bays.”

What? Am I suggesting Bee can visit his “seven-bedroom, nine-bath property includes a 4,300-square-foot main house originally constructed in 1940, along with other living spaces and buildings totaling 8,300 square feet altogether on 41 acres."

Yes, he owns all of that. It's so described in a report by the Sentinel's own Dylan Smith. The last property was once owned by Dr. Andrew Weil.

I’m not talking about some LLC sheltering his properties behind a shield of limited liability. Those three properties are in his name – plus a one-acre plot next to the pad with room for 20 ported cars. 

In all he owns just shy of $3 million in homes based on county-assessed valuations — valuations that tend to be a year behind and lag current market conditions. On top of that, the Tucson area's median home price has increased by 23 percent in the last year.

Of the other properties that are held by one of his LLCs, one lot (a "buffer" next to one of his tony homes) was sold at the beginning of this month.

Still, Bee’s attorney Michael Picarretta argued in a court filing that Bee is "indigent" and the judge basically agreed.

Picarretta is one of the better attorneys in Southern Arizona. He isn’t some public defender appointed by the court for an poverty-stricken client; Bee ain’t indigent like that. 

His bus company was pulling in $4 million a year in 2012, 2013 and 2014, when Bee got creative with Uncle Sam.

He still has that company. He told the courts he’s working up to 100 hours a week there. He also told Pima County voters he lived in Pima County, which is a requirement to serve as an elected judge. Then his lawyer told the federal courts that Bee never lived in Pima County; where did they ever get that idea? He was living in Pinal County the whole time, goes the story. Now he lives in a trailer and goes to a food bank, according to documents filed by his attorney.

Anyone with a state ID can get a food box. Trailer living doesn't guarantee pauper status. On the other hand, owning a bus company is a pretty obvious sign of not belonging to that particular club.

Imagine someone claiming poverty, with that much in their name, and trying to get welfare. Now, imagine if that person was African-American. Every Fox News viewer in America would know that person's name.

What indigent is

Here are my questions for Judge Bee to see if he’s really ever been indigent:

Have you ever got mad at yourself or your family for being hungry too soon after a meal, because none of you can afford to keep getting hungry like this? (You should have saved some of those chips for later.)

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Have you been told you you can't open a bank account because you're not enough of a human being in this society? (It's hard to save even a little bit of money when a little bit of money is all you've got, and you don't have anyplace to save it.)

Have women in RAV 4's ever pulled up next to you on a sidewalk to hand you a sandwich because you look hungry? (Did you wolf it down, because you were?)

When was the last time you spent half a day calling the Department of Economic Security, only to give up, believing it's just an experiment to see how many times a desperate person will hit "redial"? (At least the phone bill was paid, so you could try to call, right?)

If your answer is “My dog ate my answers over at one of my other three houses,” then you have failed this quiz. You are not indigent because (and has any statement ever been more American?) “indigent people don't get to choose from among their 19 different bedrooms.”

Apparently this is news to the federal courts.

So the moral of the Bee story goes, it's better to get hit with a white-collar crime at the federal level than to be thwacked with a low-level offense at the state level.

I spent a good amount of time and hit up a few lawyers I know, trying to find out how the federal courts define “indigent" — and what a fool's errand that was. 

The lawyers were more than a bit circumspect when confronted with the option of criticizing a judge’s decision. They ain’t paid to be stupid.

But I found this little nugget in the federal sentencing guidelines which steer judges in the U.S. courts toward how to hand down punishment:

“If the defendant establishes that (1) he is not able and, even with the use of a reasonable installment schedule, is not likely to become able to pay all or part of the fine required by the preceding provisions, or (2) imposition of a fine would unduly burden the defendant's dependents, the court may impose a lesser fine or waive the fine. In these circumstances, the court shall consider alternative sanctions in lieu of all or a portion of the fine, and must still impose a total combined sanction that is punitive. Although any additional sanction not proscribed by the guidelines is permissible, community service is the generally preferable alternative in such instances.

Nope. Bee doesn’t have to do community service as part of his deal. I guess being rich and white is community service enough. Nor does he have to be found to meet some sort of threshold of indigence.

The discrepancy in fines imposed across the federal courts is a longstanding issue. A General Accounting Office Report issued in 1999 found little uniformity in whether the courts imposed fines on people convicted of crimes at all.

State vs. fed

Consider the inherent congruence of the traffic law requiring registration/proof of insurance with the law that says people must pay taxes. Both are essentially violations of the social contract. Both offenses are society saying “you aren’t holding up your end.”

Get pulled over without current registration or insurance and the combined fine is $800, according to state law. Throw in surcharges and extra fees and the fine shoots up to $1,597. Anyone who ever looked over a days' worth of police reports knows this devilish duo of offenses makes up a hefty amount of police stops.

There is a work-around for both these fines. Get insurance and registration and they may go away. They are only guaranteed to be dismissed if the driver shows they had both prior to either citation being issued.

But you know what isn’t a work-around? Being too broke to pay those fines.

A minimum-wage worker putting in 30 hours a week earns about $20,480 a year. A $1,600 dollar fine equals 8 percent of their gross income for a year. Bee’s homes carry a Pima County assessed value of $3 million. What’s 8 percent of $3 million? If you guessed $240,000, you were paying attention in math class.

That’s $10,000 less than the maximum fine but nope, Bee can’t afford to pay it — or any fraction of it. But the guy who washes dishes at some local chain restaurant is 100 percent expected to pay theirs.

The U.S. Department of Treasury has said that tax cheats cost the country $700 billion per year. That’s $7 trillion over a 10-year stretch. Put that in perspective: that’s enough for Medicare for All and the biggest tax cut in the history of the country.

So it’s not a victimless crime. We are all either paying more in taxes or more for other things like health care the government would be in a position to alleviate us from paying, or both.

Bee squiggle

And Bee didn't just lie about his taxes. 

To get financing for one of his homes, he declared that property as his primary residence. Yet Picarretta argued in court that Bee hadn't lived there and that it was an "investment property." The attorney told the court that Bee and his entire family were Pinal County residents the whole time. If that's the case, then Bee lied to Pima County voters each time he filed to run for justice of the peace, declaring under penalty of perjury that he was a resident in a different home over on the East Side. Under Arizona law, elected JPs must be residents of the precinct they serve. If he was living 75 miles away in Casa Grande, he wasn't eligible to be elected to that office. Yet he was, repeatedly.

Somebody's piling up B.S. here.

Bee's line is anything but straight. It curves, circles, winds and squiggles all over the place depending on what offense he is trying to prove himself innocent of committing.

Look, I don’t mean to bag on Bee, the judge in his case or, for God's sake, Picarretta for zealously defending his client to keep him out of the hottest water.

I don't know Bee, but he had a good rep around town, and his brother Tim is a hell of a nice guy who was a great state lawmaker and would have made for a fine congressman when he ran against Gabrielle Giffords many years ago.

Sentencing shouldn't be about separating good people from bad. It's about punishing an offense based on reasonable aggravating and mitigating factors. It should be uniform, and yes, blind.

The problem is what is represented by Bee skating on a monetary fine. The problem is the law sees the dishwasher as flush but the millionaire business owner as broke, if he suddenly decides to live in a trailer and hit up a local food bank.

They are just gaming a system that has one kind of justice for rich offenders and another for anyone who is struggling.

It's like one lawyer put it to me on the down-low: "You get all the justice you can afford."

Blake Morlock is an award-winning columnist who worked in daily journalism for nearly 20 years, and as a communications director for the Pima County Democratic Party. Now he’s telling you things that the Devil won’t.


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Paul ingram/TucsonSentinel.com

This house says a lot of things but 'poverty' isn't one of them. Though its owner, former Pima County Justice of the Peace Keith Bee, successfully claimed he's indigent — and he owns a few more homes just like it.

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