PROVIDENCE -- Rhode Island's most famous reality television star
proclaimed he was innocent of tax evasion and fraud even before his
arraignment on the federal charges this morning.
Richard Hatch, 44, of Newport, the self-styled "fat, naked guy" from
Survivor, held court for the media outside the courtroom before his formal
appearance in front of U.S. Magistrate Judge Lincoln B. Almond.
"This is absurd," Hatch said. "I'm not guilty."
Hatch, who gained fame for winning the first Survivor challenge,
was named in a 10-count indictment Sept. 8 charging him with failing to
pay taxes on the more than $1 million he won on the popular TV series,
as well as income from a radio program, rental income and charitable
donations he allegedly used for himself.
Hatch's case was brought to a grand jury after he walked away from an
agreement with the U.S. Attorney's Office in March in which Hatch had
agreed to plead guilty to two counts of tax evasion. He said he didn't
go through with it because he isn't guilty.
"I've always, always, always paid my taxes and always will," he said.
The indictment includes additional charges against Hatch and the
potential for a longer sentence, if convicted.
Hatch, who has hired new lawyers, is charged with two counts of tax
evasion, one count of filing a false S-Corporation income tax return,
two counts of wire fraud, four counts of mail fraud and one count of
bank fraud.
One of his attorneys, John MacDonald of Providence, formally entered a
not-guilty plea to all counts during his arraignment. Almond released
Hatch on a $50,000 secured bond with several conditions.
Before the arraignment, Hatch -- dressed casually in a light-blue shirt
and dark-blue pants and wearing a thin beard -- claimed that the case
became personal for the U.S. Attorney's Office when he walked away from
the plea agreement. He said that they wanted him to serve two years in
prison.
Journal photo / Gretchen Ertl
Richard Hatch of Newport, winner of the first Survivor TV series, listens to a message from one of his lawyers today
outside federal court in Providence, where he was arraigned on the charges.
U.S. Attorney Robert Clark Corrente, in court for Hatch's arraignment,
later said, "It's not about personality. This is about evidence."
The grand jury alleges that Hatch failed to report about $1,037,000 from
Survivor in 2000 and 2001, including a Pontiac Aztec valued at $27,074 and
given to him as part of his Survivor prize.
It also alleges that Hatch failed to report $326,540 that Entercom,
Boston, LLC paid him in 2001 for appearances on the Wilde Show, a radio
program on WQSX-FM; $28,104 in rental income in 2000 and 2001 from his
property at 21 Annandale Road, Newport; and $36,500 in charitable
donations to Horizon Bound.
Hatch allegedly set up Horizon Bound as a charity to help troubled
teenagers and accepted those donations but used the money for his
personal expenses. The indictment charges Hatch with a scheme to defraud
in connection with those contributions, allegations that he did not face
when the U.S. Attorney's Office charged him via criminal information in
January.
Hatch apparently shopped around for the best tax return that he could
get for the year 2000.
According to the indictment, a Newport accounting firm prepared a 2000
tax return for Hatch, including $1,010,000 he received in in August 2000
for Survivor, and concluded that Hatch owed $441,501 in taxes.
The grand jury alleges that Hatch never filed that return. The
indictment goes on to say that, in December 2001, Hatch hired a
Middletown accountant to prepare another 2000 return for him. That
return, which also included the Survivor income, concluded that
Hatch owed $234,807.
The grand jury alleges that Hatch did not file that return either. In
the fall of 2002, according to the indictment, Hatch asked the
Middletown accountant to prepare a 2000 return that did not reflect the
Survivor income. The accountant did that, but cautioned Hatch that the
return, calling for a $4,483 refund, was for "informational" purposes
only and was not to be filed.
The indictment alleges that Hatch did not heed the accountant's warning
and filed that return with the IRS.
The maximum penalties for the charges Hatch faces are five years in
prison and a $250,000 fine for each of the two counts of tax evasion,
the two counts of wire fraud and the four counts of mail fraud; three
years in prison and a $100,000 fine for filing a false S-Corporation
income tax return; and 30 years in prison and a $1-million fine for bank
fraud.
If Hatch had gone through with his plea agreement, he would have faced a
maximum penalty of five years in prison and a $250,000 fine on each of
the two counts.
In court today, Almond ordered Hatch to turn in his passport and
restricted his travel to Rhode Island, but said he could go to Houston
to consult with his attorneys.
Nationally-known tax attorney Michael L. Minns and another Houston
attorney are asking the court's permission to join MacDonald in
representing Hatch.
In March, Hatch appeared on NBC's Today Show with Minns, who is
author of "How to Survive the IRS: My Battles Against Goliath." During
that television appearance, Hatch told host Katie Couric that CBS should
have withheld his taxes on the Survivor prize. Minns said Hatch's
contract with CBS indicated that the grand prize would be "less all
applicable withholdings, deductions and taxes."
Almond said Hatch could also travel to New York or Los Angeles for work,
but he must first receive permission from the government and file
detailed information about the job and his itinerary.
Hatch says his legal problems have already hurt his show business career.
"I've been dropped from all kinds of things that had already been
scheduled," he said, declining to be specific.
Hatch has recently been a featured member of the cast of Battle of
the Network Reality Stars, a six-part TV series that began in
mid-August on Bravo. Hatch says the taping for that show has concluded.
Hatch today claimed that the government was "using my notoriety" in its
case against him, but he added later, "I don't regret Survivor.
I enjoyed myself. I think I played it well."
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