A Letcher father and son were sentenced in a Sioux Falls federal court last Monday, nearly 11 months after being found guilty of conspiracy to defraud the United States, multiple counts of failure to file an income tax return and impeding the Internal Revenue Service.
Ted Nelson and his son, Steve Nelson, were “jointly or severally” ordered to pay a total restitution of $1,842,102.14, meaning one or both of them could pay the bill.
Ted Nelson was sentenced to five years in prison and three years of supervised release and was ordered to pay $250 in special assessments. He had been detained since a jury found him guilty in May 2015.
Steve Nelson was sentenced to one year and one day in prison and three years of supervised release. He was also ordered to pay $250 in special assessments. The court approved a motion to allow him to surrender himself on his own accord to begin his sentence on April 18.
The Nelsons’ tax evasion scheme began prior to 2002. Together, Ted and Steve Nelson formed a number of trusts, corporations, LLCs and other entities in an effort to avoid paying income taxes. The pair claimed to be a part of a sovereign group called the Pembina Nation Little Shell Band of North America.
During trial, Ted Nelson, representing himself, said he believed that he could not pay income taxes because only God owns anything on the planet.
Steve did not use the sovereignty defense and filed a motion to sever his case from his father. The motion was denied.
Ted Nelson, who served a year in prison in 2011-12 for harboring a man wanted for tax fraud and other federal crimes, received a 60-month sentence April 4 for the charge of conspiracy to defraud the United States. He also received 12 months for seven counts of failure to file an income tax return and 10 months for impeding the IRS, all to be served concurrently.
Steve Nelson was sentenced to 366 days in prison for conspiracy to defraud the U.S., 12 months for eight counts of failure to file income tax returns and for impeding the IRS, also to be served concurrently.