Suit Against Bank of America for $30 Million Tax Scam

A lawsuit has been drafted against Bank of America to retrieve $30 million that flowed through accounts held by Harriette Walters and others in the D.C. tax scam, Acting D.C. Attorney General Peter Nickles told yesterday.

During an almost eight-hour confirmation hearing before a D.C. Council committee, Nickles said the city is negotiating with the bank in hopes of reaching a financial settlement. If they cannot agree, he said, the District would likely follow up on the lawsuit.

"Our complaint lists checks through Bank of America," said Nickles, who proposed to let the council see copies of the draft.

In an interview, Nickles said he has given the bank until Friday to respond to a settlement offering, the terms of which he would not disclose. Under an accord with the bank that extended the statute of limitations, the District has until Nov. 10 to file the lawsuit.

Nickles said the draft of the lawsuit also includes charges under the "False Claims Act," which could triple the pecuniary damages.

In the tax scam case, Walters, an erstwhile tax office manager, and 10 confederates have pleaded guilty to stealing $48 million over 20 years from the D.C. Office of Tax and Revenue. The amount mentioned in the draft of the lawsuit is based on the amount of the checks cashed at Bank of America, Nickles said.

Bank of America was the elementary bank used by Walters and most other participants in the scam, and the vast bulk of the money stolen from the District flowed through the institution. One defendant, Walters's niece, Jayrece Turnbull, transferred more than $24 million through various accounts there.