Former Gary councilwoman sentenced to prison
BY TERESA AUCH SCHULTZ firstname.lastname@example.org January 8, 2014 4:48PM
Marilyn Krusas was sentenced in federal court on Wednesday. | Post-Tribune File Photo
Updated: February 10, 2014 11:48AM
A federal judge sentenced former Gary City Councilwoman Marilyn Krusas to a year and a day in prison, saying her mental health issues don’t explain how she went 20 years without filing a tax return and then hid money from the IRS.
Krusas, who has trouble speaking, apologized in writing for her actions, taking sole responsibility, but said that crushing depression kept her from paying her taxes for two decades.
“Once my first failure to file my return happened, I became overwhelmed and was too proud to ask others for help,” she wrote.
Krusas’ attorney, Scott King, had asked that she serve either home detention or a period of probation, arguing that she has suffered depression since the 1960s, with periods so bad that she couldn’t leave her house.
He says this, plus a new diagnosis of narcissistic personality, explain why she went so long without filing and paying her taxes. People with narcissistic personality care overly much about what others think of them, and King said that after going one year without filing her taxes, the idea of seeking help embarrassed her. The problem only grew and compounded as each year passed, he said.
Krusas wrote in her statement that by the time she started receiving notices from the IRS about 14 years ago, she was already going through foreclosure and facing several lawsuits, including a warrant for failing to appear at a hearing.
“... I felt helpless and was panicked by the thought of the public and newspapers learning that I, a person that prided myself in demanding accountability and transparency in city government, was personally failing in my private life,” she wrote.
King also noted that she was diagnosed with lung cancer after she pleaded guilty in April to tax evasion and that she recently discovered the cancer, which was removed, has spread to her kidneys and might be back in her lungs.
He disputed that her crime counted as public corruption, arguing that she never used her office on the council for her crimes and that even though she had financial incentive to use her position for monetary gain, she never did.
“What she did, she did to herself, not to the city of Gary,” King said.
Assistant U.S. Attorney Gary Bell said argued that it was hypocritical of Krusas to help set the city’s budget and direct where tax revenue would be spent and then go two decades without paying her fair share of taxes.
“She took an oath each time she was elected to abide by the law,” Bell said.
He also said Krusas was knowingly trying to hide an inheritance of $232,000 from the IRS when she used parts of it to pay off her mortgage and other bills and then wrote several checks of less than $10,000 each totaling more than $90,000 to her sister in order to evade a legal requirement that banks alert the government to activity of more than $10,000.
King argued that was because Krusas had a mistaken belief of how much money she could gift tax-free to her sister at one time.
U.S. District Judge Joseph Van Bokkelen said he saw Krusas’ depression as a mitigating factor, but that it didn’t explain going 20 years without filing a return and then evading paying the taxes she owed. Although she might have experienced periods of debilitating depression, she still had periods where she was fully functional, including successfully running for public office.
“It comes nowhere near an excuse,” Van Bokkelen said.
The judge did say that although her role as a public official made her crime even more disappointing, especially in a region that has a problem with public corruption, he did not enhance her sentence because of it.
King said after the hearing he was concerned that increasing a public official’s sentence for any crime, whether it is related to the office, might deter more people from seeking election.
“I just think it’s a slippery slope,” he said.
The sentence of more than a year means Krusas must serve at least 85 percent of it, which in this case is about 11 months. Van Bokkelen gave her until March 26 to report to prison.