Adams released one more time prior to tax evasion sentencing
Hartford — The next time David M. Adams walks out of a federal courtroom, it probably won't be by the front door.
The 57-year-old businessman has managed to delay his sentencing on tax evasion charges for a year, but U.S. District Judge Vanessa L. Bryant told him Tuesday that she intends to impose the sentence on Nov. 27.
Bryant denied the government's motion to revoke Adams' bond based on the discovery of a "secret" bank account following a two-hour hearing during which his medical condition, "astonishing" spending habits and continued efforts to conceal funds were discussed.
She released him one last time, after imposing a cash bond of $250,000, which is the amount of all the money he said he has in bank accounts — about $200,000 — plus $50,000 from his family. The judge ordered him to produce the cash within 48 hours, to be monitored electronically, and not to leave his Old Saybrook townhouse except for medical appointments. She demanded a new disclosure of all his assets by Oct. 26.
Adams made approximately $12 million from the sale of two flower businesses and had other business interests, according to court testimony and documents. The government says he has engaged them in a decades-long cat-and-mouse game, first by underreporting his income and underpaying his taxes, then by delaying his prosecution once he was arrested and pleading guilty at the 11th hour before his trial was to begin in October 2017.
Judge Bryant said that Adams has been "unremittingly dishonest" at the cost of hardworking American taxpayers and told him if he fails to fully disclose all bank accounts, insurance policies, trusts and tax returns, she would "depart upward, significantly," from the sentencing guidelines that indicate he should receive a sentence of 78 to 97 months in prison.
"If Mr. Adams thinks this is a fun game, Mr. Adams should know: The fun is about to end," Bryant said.
His attorneys, William T. Koch Jr. and Drzislav "Dado" Coric said they plan to argue for a 46-month sentence, which is a downward departure from the guidelines. Koch said he also plans to argue that the amount of restitution Adams owes should be approximately $2.6 million rather than the $4.8 million the government is seeking, due to added interest and penalties.
Adams' most recent sentencing delay was the result of renal failure that resulted in his hospitalization two days before his scheduled sentencing on Oct. 3. On that day, the judge ordered him to appear in court within 24 hours of his release from the hospital. Released on Friday, Adams appeared in court Tuesday with hospital discharge orders indicating he has to receive four hours of dialysis three times a week.
Assistant United States Attorney Susan L. Wines has filed motions to revoke the $500,000 real estate bond that Adams had posted following his indictment using his vacation home in Mashpee, Mass., on Cape Cod. Wines filed the first motion to revoke bond after the government discovered that the home was in foreclosure, but a federal magistrate denied it after learning there was still $600,000 in equity on the $1.2 million property.
In her most recent motion, Wines said Adams had used $200,000 from a bank account he had failed to disclose to the prosecution. The account contained the $500,000 proceeds of an insurance policy that Adams said he had taken out on his ex-wife, Sandra Adams, in the 1990s. Mrs. Adams died in March, and Adams said he had not disclosed the funds because he had completed his financial affidavit prior to his ex-wife's death.
The prosecutor noted though that Adams had taken the funds from a liquid bank account that could be seized by the government and put them on a home that is held by a trust on which the government has been unable to place a lien.
Wines said bank records indicate that from June to September, Adams spent about $75,000 a month on "resorts, restaurants, golf clubs and the like." She said his bank account listed expenditures to the Water's Edge Resort in Westrbrook, a Jaguar dealer, a pool service and the Goodspeed Opera House, and that there was nothing in his financial affidavit indicting he had the ability to access that much cash.
Wines said she had talked to U.S. Marshals who told her that Adams could be housed by the Connecticut Department of Correction and provided with the necessary medical care while awaiting sentencing. Attorney Koch objected to that plan, citing the case of a man in custody in Utah who died because he wasn't provided dialysis.
Judge Bryant ordered Koch to produce Adams' medical records prior to his sentencing so that they could be turned over to the federal Bureau of Prisons.
She said she was releasing him only because of his medical condition. The judge said she considered Adams dishonest and his spending habits when determining he is a flight risk and imposing the additional cash bond.
"Anyone who needs $75,000 a month to live finds the prospect of a prison cell daunting," Bryant said.
Editor's Note: This version corrects the recommended term of imprisonment for businessman David Adams, which is 78 to 97 months under federal sentencing guidelines.
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