Chad Abraham

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August 10, 2005
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Gradow to go to prison

A well-known Aspen man who cheated the Internal Revenue Service out of nearly $130,000 pleaded guilty Wednesday in federal court in Denver.George Gradow, 65, will serve at least one year in prison, and possibly as much as 18 months, after pleading guilty to obstructing the IRS. The husband of former Playboy Playmate Barbi Benton was accused in June of destroying and altering documents related to an IRS audit of his Carbondale-based company.From Aug. 21, 2000, until March 14, 2001, Gradow altered interest rates and due dates on promissory notes and changed the terms of leases relating to the Churchill Group, according to the plea agreement. And he ordered employees to do the same."Specifically, Gradow instructed the chief financial officer of his corporation to forward to him original promissory notes and real estate leases," says a news release from the U.S. Attorney's Office in Denver.After altering the interest rates, due dates and lease terms, "he then destroyed the original notes and leases, knowing the altered documents would be reviewed and relied upon by the IRS," the release says.It isn't clear what the Churchill Group does. A woman reached at the Carbondale office was reluctant to talk, other than to say the business works in commercial real estate. A spokesman for the U.S. Attorney's Office said the business was set up to handle Gradow's financial assets and investments.Gradow, who made millions in the mobile-home business, will be sentenced in U.S. District Court on Dec. 19. Such a lengthy time between pleading and sentencing, four months in this case, is common, said Jeff Dorschner from the U.S. Attorney's Office.The probation arm of the federal court system will prepare a pre-sentence analysis of the case to advise U.S. District Court Judge Wiley Daniel on sentencing Gradow. It involves "the history of the defendant [and] the history of the crime that he's pleaded guilty to," Dorschner said."Based on the plea agreement, he faces between 12 and 18 months in federal prison," he said. "For somebody of his stature, that is substantial."Gradow didn't return a message left at his home, a 27,500-square-foot residence on 40 acres in Starwood dubbed "The Copper Palace." But a statement released from his lawyer, veteran tax attorney Joseph Thibodeau, of Denver, said the plea deal "follows an extremely trying and difficult five-year period of intense investigation, scrutiny and negotiation by and with the United States government."Mr. Gradow earnestly hopes that his decision and action will serve to lift some of the enormous emotional and psychological strain and financial burden which his conduct has visited upon his family, his employees, his friends and associates," the statement says.Dorschner said the tax loss to the federal government was approximately $128,000. Based on the plea agreement, the IRS can hold Gradow responsible for any tax liability that it determines he owes.After Gradow is sentenced, the federal Bureau of Prisons will decide where he is placed."He could serve anywhere in the country at the discretion of the bureau," Dorschner said.Chad Abraham's e-mail address is chad@aspentimes.com


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The Aspen Times Updated Aug 11, 2005 08:59AM Published Aug 10, 2005 12:00AM Copyright 2005 The Aspen Times. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.