In closing arguments, the government says the Survivor star deliberately failed to pay taxes, while the defense says there was no intent to defraud.

01:32 AM EST on Wednesday, January 25, 2006

BY RICHARD SALIT
Journal Staff Writer

PROVIDENCE -- Strip away Richard Hatch's veneer of sincerity and smooth talk and what you find underneath is what truly motivates him -- "greed," a federal prosecutor said during his closing argument yesterday in the Survivor star's tax evasion trial.

That's why Hatch deliberately filed a tax return that didn't include the $1 million he won on the reality TV show in 2000, said Assistant U.S. Attorney Andrew Reich.

"There's only one reason he filed that return: Greed. He didn't want to pay the taxes he owed," Reich told the jury. Now, he said, Hatch is relying on his skills as a corporate trainer to "sound convincing" and talk his way out of trouble. "Ladies and gentlemen, he had to come up with some story and he came up with the best he could."

But Michael Minns, Hatch's lawyer, portrayed Hatch as an "honest man" who is a victim of overzealous prosecutors and a "hounding press." He said that Hatch has endured all sorts of undeserved legal trouble and negative publicity since being cast as the bad guy on Survivor, including the tax charges and unfounded allegations that he abused his child.

Journal photo / Andrew Dickerman

Richard Hatch leaves the federal courthouse yesterday, whistling, while a jury ended its first round of deliberations in his tax-fraud trial without a verdict.

"He was supposed to be the evil villain," said Minns. "Everybody has gone after him since, like the Hunchback of Notre Dame."

Closing arguments in Hatch's trial concluded yesterday morning. At 4:30 p.m., after nearly two hours of deliberations, the jurors recessed for the day. They will resume at 9 this morning.

Hatch, of Newport, is charged with two counts of tax evasion, one count of filing a false income-tax return, four counts of mail fraud, two counts of wire fraud and one count of bank fraud. The maximum penalty he faces is 30 years in prison and a $1-million fine.

Reich, in his closing, listed multiple sources of income that Hatch did not include in his 2000 and 2001 tax returns. Reich cited $27,000 in rental income from two Aquidneck Island properties Hatch owned, $320,000 he was paid for cohosting a Boston radio program, and his Survivor winnings -- $1 million and a Pontiac Aztec.

Hatch also used for personal expenses $36,000 in contributions he received for Horizon Bound, an outdoor teen program that he was purportedly starting. The money, said Reich, went toward extravagant improvements to Hatch's properties and to tips for the laborers and his driver.

The fraud counts relate to Horizon Bound documents. Its incorporation papers list two people as officers who testified that they had nothing to do with the nonprofit organization. Also, Hatch allegedly forged one of their signatures when faxing incorporation papers to NBC, which was making a $25,000 donation to Horizon Bound for his appearance on The Weakest Link. Prosecutors say that he took that check, which was payable to Horizon Bound, and added his name to it so that he could deposit into a personal account.

John MacDonald, one of two lawyers who argued for the defense yesterday, maintained that Hatch had a lifelong dream of reviving Horizon Bound, a program that benefited him in his troubled youth. Hatch, he said, talked extensively to one of its original directors about recreating it. He also spent his own money incorporating it and printing business cards and stationery for it. There's nothing illegal, he said, about Hatch reimbursing himself for expenses he incurred.

"Where is the intent to defraud?" MacDonald asked. "Was this all concocted, a scheme to line Richard Hatch's pockets" with just $36,000, when he was already a millionaire?

Minns denied prosecutors' assertions that Hatch purposefully withheld information about his income when he asked a second accountant, Judi Rodrigues Wallis, to prepare his return for 2000. The first preparer Hatch went to concluded that he owed $374,000. Wallis, who didn't list all the same sources of income, calculated that Hatch owed $234,000 for that year.

Ultimately, Hatch filed a return that did not include the Survivor income and got a refund that year of about $4,500. Wallis prepared the return for him, but testified that Hatch asked her for it for informational uses only and agreed in writing not to file it.

Minns challenged Wallis' credibility, suggesting that at one point she advised Hatch to file an illegal return. As a result, he said, she hired a criminal defense lawyer and agreed to cooperate with prosecutors to avoid any charges.

Minns said Hatch didn't claim the Survivor income because he believed that CBS or Survivor producers or advertisers were going to pay for the taxes, despite a contract he signed that made him responsible for all taxes. Hatch, he said, was "rebuffed" when he made inquiries about his taxes to those affiliated with the show and "was never able to get an answer."

Mistakes were made by Hatch, who at the time was traveling extensively, defending himself against allegations he abused his son, and coping with being the victim of an embezzler, said Minns.

"If we make mistakes, it doesn't mean, we're criminals. . . . All we can do is apologize and move on," he said. "There has been complete, total absolute cooperation from Richard Hatch. He has not tried to conceal anything. . . . All of his taxes will be paid."

rsalit@projo.com / (401) 277-7467