Latah County man sentenced on federal charges

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Story Published: Jun 18, 2009 at 7:03 AM PDT

Story Updated: Jun 18, 2009 at 7:03 AM PDT

By KLEW Web Staff

BOISE - Jeffrey Lewis Grinolds, 44, of Juliaetta, has been sentenced to a year and one day in federal prison for bankruptcy fraud and failure to file an income tax return.

U.S. District Judge Edward J. Lodge also ordered Grinolds to serve three years of supervised release after he completes his prison term and to pay $208,024 in restitution.

According to the U.S. Attorney’s Office in Boise, Grinolds filed for chapter 7 bankruptcy in April 2003 in Latah County, claiming that he had only $30 cash and an interest in a wrecked Peterbilt truck worth $300. He specifically denied having any checking or savings accounts, or any interest in any businesses. He further denied having had a sole proprietorship or being self-employed any time over the preceding six years.

However, at the time he filed for bankruptcy, Grinolds had an interest in a sole proprietorship called Grinolds Fabrication. He also had interests in logging contracts with Guy Bennett Lumber Company and a savings account containing more than $4,000.

Prosecutors say Grinolds willfully failed to file federal income tax returns for tax year 2003, despite earning gross income in excess of $389,000 during that period.

Grinolds entered a guilty plea to the charges in September 2008.

“Fraud and dishonesty in bankruptcy proceedings undermine the integrity of these vital proceedings that help debtors recover and allow the marketplace to function,” said U.S. Attorney Tom Moss. “Failure to pay taxes and be honest with the court is a gross violation of civic duty and will be punished.”

The case was investigated by the Internal Revenue Service - Criminal Investigation Division, and the United States Trustee Program.

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