Former Deer Creek Ranch owner pleads guilty to tax evasion
Prescott facing up to five years in federal prison for ‘promotion and sale of abusive trusts’
From our weekly issue dated July 08, 2009
One of the former owners of the Deer Creek Ranch property on Illinois River Road in Selma, now home to the Siskiyou Field Institute (SFI), has pleaded guilty to federal tax evasion charges.
Former Selma resident Roderick Prescott admitted to evading at least $550,000 in personal income taxes for 1998 and 1999, according to a Tuesday, June 30 U.S. Dept. of Justice press release.
It states that Prescott, the former principle of National Trust Services (NTS) in Selma and San Jose, Calif., now resides in Orem, Utah.
Prescott’s trial was scheduled to begin on Tuesday, July 7 in Eugene.
Along with his now-deceased business partner, Leroy Fritts, the Dept. of Justice states that Prescott “allegedly was involved in the promotion and sale or abusive trusts through NTS.” The government claims that Prescott and Fritts also recruited NTS clients to invest in Fountainhead Global Trust (FGT), an offshore investment that promised returns as high as 50 percent per year.
The release states that FGT collected $20 million in investors’ funds between 1995 and 1999, and that Prescott and Fritts funneled part of the money in that offshore account to themselves.
Those funds, which the government asserts totaled up to $3.5 million, were said to be spent on luxury goods and real estate, including purchase of Deer Creek Ranch.
Prescott and Fritts are accused of having used trusts and accounts to conceal their income from IRS, according to the Dept. of Justice.
The government claims that Prescott last filed an income tax return in 1991. He now faces a maximum sentence of five years in prison and $250,000 in fines.
Construction began on two custom-built luxury log homes on the Deer Creek Ranch property, with a combined budget of $2 million, the release states. More than $465,000 was spent on construction before work was halted in 1999.
Solar panels for the ranch were purchased for more than $328,000; and more than $1.1 million was spent on food in anticipation of the famed Y2K disaster, the release states.
The longtime tax troubles faced by Prescott and Fritts eventually enabled SFI to acquire Deer Creek Ranch. “The IRS put millions in tax liens on the property because of potential illegal activity on the part of some of the owners,” said Sue Parrish, former SFI executive director. “They were forced to sell.”
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Between 2004 and 2005, SFI began negotiating with Prescott’s former wife, Carla, for the property, Parrish said.
“She became the trustee instead of him because she wasn’t under investigation,” Parrish said. “We started negotiating with her because they wanted to get some funds out of the property.”
Parrish confirms that the property’s previous owners stockpiled food in preparation for potential disaster.
“When we were in the process of buying it, they were totally preparing for Y2K,” she said. “There were big metal cans of emergency rations, with different grains. They were preparing for the end of the world.”
The property contained a 4-foot tall Styrofoam freezer building, “barrels and barrels of salt” and all kinds of trash, Parrish said.
“There were mountains of junk. We got rid of three huge truckloads of tires and all kinds of stuff,” she said. “It took literally thousands of hours of community effort to clean up the property.”
But ultimately, the tax troubles that continue to plague Prescott led to the establishment of a permanent home for SFI.
“The property is now for the community,” Parrish said.
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