Prominent tax dodger Winston Shrout was supposed to surrender to prison earlier this month, but is now accused of dodging his 10-year prison sentence by failing to turn himself in to the federal Bureau of Prisons as ordered.

Shrout was scheduled to start serving his sentence March 4, the first Monday after the 9th U.S. Circuit Court of Appeals denied his request to remain out of custody pending his appeal of his conviction and prison term. The appeals court upheld U.S. District Judge Robert E. Jones’ ruling that Shrout would pose a danger if he were to remain in the community.

The next day, federal authorities issued a warrant for Shrout’s arrest.

On Wednesday, a federal prosecutor urged the appeals court to dismiss with prejudice Shrout’s appeal because of his fugitive status. Dismissal with prejudice would mean Shrout wouldn’t be able to file an appeal at a future date.

The government noted that Shrout filed the opening brief for his appeal on Monday, while he was a fugitive.

Katie Bagley, tax division attorney with the U.S. Department of Justice, wrote to the 9th Circuit that Shrout’s lawyer noted only that the Bureau of Prisons website indicated Shrout wasn’t in custody and didn’t provide any information that would excuse Shrout’s failure to surrender to prison.

"Defendant has repeatedly attempted to delay serving his sentence. Having exhausted those efforts, defendant has now chosen to defy the court,’’ Bagley wrote. “ This is precisely the kind of ‘heads I win, tails you lose’ gaming of the system that the fugitive disentitlement doctrine is intended to prevent.’’

Shrout’s lawyer, in the effort to keep his client out of prison pending the appeal’s outcome, argued that Shrout wasn’t likely to flee or endanger the community. The 70-year-old has significant family and community ties to Oregon, had followed conditions of supervised release for the past three years and had no prior criminal record, defense lawyer Ruben Iñiguez said.

Shrout was sentenced Oct. 22 after a federal jury convicted him of six misdemeanor counts of willful failure to file tax returns and 13 felony counts of producing, presenting and shipping fictitious financial instruments.

Shrout, a sovereign citizen, made and issued more than 300 fake "International Bills of Exchange'' on his own behalf and for credit to third parties. The government said Shrout falsely claimed the bills had value and purported that they were worth more than $100 trillion. Shrout also testified at trial that he stopped paying income tax or filing income tax returns “well over 20 years ago.’’

The government proved at trial that from 2009 through 2014, Shrout received over $500,000 in gross income through pension payments, speaking fees at seminars where he espoused his theories abroad, royalty payments for the sale of DVDs and other products he sold and for private client consultations through his business Winston Shrout Solutions in Commerce, yet never filed a single tax return.

Judge Jones, asked by the appeals court to explain his reasoning for denying Shrout’s release pending his appeal, wrote, in part: “ Shrout spent over a decade selling scams to hundred, if not thousands, of gullible people. He told them if they followed his advice, they could avoid paying taxes and that the government and banks would give them millions of dollars. Even after he was convicted in this case, he continued to advertise his for-profit seminars until I explicitly forbade him to continue. Even then, he told his followers that he would be back once the government changed. If he remains on release, he may well continue his illicit efforts.’’

-- Maxine Bernstein

Email at mbernstein@oregonian.com

Follow on Twitter @maxoregonian

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