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April 05, 2023 at 12:36 PM
What You Need to Know
- An ex-Oregon broker was sentenced to 51 months in federal prison and three years of supervised release for tax evasion.
- Instead of paying his taxes, he used the money on luxury cars, homes and equestrian expenses.
- He closed his BD at the end of 2016, in part because a FINRA arbitration panel determined he had churned the investment accounts of several clients and fined him $450,000.
An ex-Oregon broker was sentenced to more than four years in federal prison on Monday for willfully evading payment of over $2.5 million in personal income taxes and using the excess cash from his tax evasion to fund a lavish lifestyle.
James W. Millegan, 65, of McMinnville, Oregon, was sentenced to 51 months in federal prison and three years of supervised release, according to court documents and the Justice Department. He was also ordered to pay more than $2.5 million in restitution to the IRS and more than $1.4 million to 12 former clients.
Personal assistants who were hired to pay his bills described Millegan as a “prolific spender” who used the proceeds of his tax evasion to support his extravagant lifestyle, according to the Justice Department.
Luxury Homes, Cars and Equestrian Expenses
A press release detailing Millegan’s purchases lists a $4.5 million home in the affluent Dunthorpe neighborhood, a suburb of Portland; a $1.3 million beach house in Gleneden Beach, Oregon; Rolls Royce and Bentley cars for everyday use; equestrian expenses, including stabling and lessons; and an attempt to establish Wallace Bridge, an equestrian competition center and resort near Sheridan, Oregon.
Millegan bought a classic 1938 Rolls-Royce Phantom III touring car in 2003. From 2004 to 2006, despite owing hundreds of thousands of dollars in past-due taxes, Millegan spent $800,000 restoring his Phantom III, including shipping it to a restoration specialist in the U.K., so he could show it at classic car shows, according to the Justice Department.
In 2006 and 2007, Millegan paid to show his Phantom III at several premier car shows in the U.S., U.K. and other European countries.
According to court documents, Millegan owned and operated J.W. Millegan, a small, commission-based broker-dealer business that served clients in the Portland and Salem, Oregon, metropolitan areas. The firm was Millegan’s only significant source of income from 1996 to 2016, according to the Justice Department.
Millegan closed JWM at the end of 2016, in part because a Financial Industry Regulatory Authority arbitration panel determined he had churned the investment accounts of several clients and fined him $450,000. Millegan filed for Chapter 13 bankruptcy nearly immediately, the Justice Department said.
Tax Evasion Charges
Over the seven-year period from July 2009 through September 2016, Millegan evaded payment of $2.5 million in income taxes due between 2006 through 2015, the Justice Department charged.
