Larry Lake lives comfortably in a red brick McMansion in Colleyville with his wife Kathy, enjoying the fruits of a handful of successful businesses he owns. He's a licensed pharmacist and co-owner of the Grapevine Drug Mart. On the side, he established VIP Finance, an auto-title loan business with branches throughout DFW and Cash Auto Sales, an affiliated business.
The Lakes' situation appeared rosy until their spending apparently caught up with them, and, in 2004, the couple filed for bankruptcy. The proceedings dragged on for six years before they took a somewhat unexpected turn. One day in October, 2010, federal agents raided the Lakes' Colleyville home and seized $6 million in cash.
The government filed a motion in federal court seeking forfeiture of the assets but quickly backed off so as not to interfere with a potential criminal case against the couple.
That case was filed yesterday by the U.S. Attorney's Office. The Lakes are charged with a single count of concealing their assets in their bankruptcy hearing, nine counts of money laundering, four counts of tax evasion, and one count of conspiring to hide their alleged financial misdeeds from the government.
The Lakes' scheme, according to the indictment, wasn't particularly complicated. Lake would take the daily cash receipts from the businesses he owned and deposit them in a slew of bank accounts he and his wife had, always taking care to keep the transactions under $10,000 to avoid triggering banks' mandatory reporting requirements.
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None of this was reported to the IRS. For the years 2006, 2007, and 2008, the government figures the couple owes more than $4.8 million in taxes.
And now, with the criminal complaint filed, the Feds are once again asking to keep the Lakes' seized property. This includes the $6 million cash taken from their home but also $9.1 million kept in various bank accounts and that nice house in Colleyville.
Update at 3:20 p.m.: The Lakes' attorney, Lawrence Brown, sent along a statement essentially denying the government's claim.
These charges appear to be based on a number of misunderstandings. Mr. Lake has operated a highly successful and cash-intensive business for many years, and has legitimately deposited, transferred, and held large amounts of cash. Some of these practices may be ill-advised, but they are not criminal. Mr. Lake has consistently paid all his taxes and filed all proper documentation regarding his finances. We look forward to presenting our case to a jury.