State Of Oklahoma: $200 Million In Delinquent Taxes Are Uncollectable

By Jennifer Loren, The Oklahoma Impact Team

OKLAHOMA CITY -- Oklahoma has a huge budget problem. Agencies are taking big cuts. People are being furloughed and layoffs are next.

Meanwhile, the state of Oklahoma has a list of people and companies that owe more than $200 million in back taxes. The list shows the top 100 tax delinquents in the state of Oklahoma. But tax collectors say they can't get to it.

"This is a lot of money that the state could have," said Jennifer Loren with the Oklahoma Impact Team.

"Right, it most definitely is," said Paula Ross, spokesperson for the Oklahoma Tax Commission.

Delinquent number one is Bruce Bonnett. According to the Tax Commission Bonnett owes a whopping $111-million. That's more than the other 99 on the list combined. Bonnett spent several years in prison for bank fraud, but was released in 2003 and, according to the tax commission, has yet to pay a single dime of the $111 million.

Marjorie Welch and her legal team at the Oklahoma Tax Commission have the job of trying to collect from Bonnett and all the others. When it comes to the worst offenders, she says, it's easier said than done.

"We can only do what the law allows us to do," said Welch.

Welch says, bottom line, they can't collect money if there are no assets to collect. But she admits some assets could just be hidden.

"People who want to hide their assets probably are fairly creative," said Welch.

We went to Enid to check on Bonnett's assets... and we had no trouble finding some. He has a home in his wife's name and a luxury S-U-V, a Lincoln Navigator, in their driveway. Not only has Bonnett not paid any of his delinquent taxes, he also hasn't filed an income tax return in at least the last two years. But when we visited his home his wife said he was working. She also said they were aware of the list, but only because the media brought it to their attention.

"Hey, that's thirty years old almost... or twenty-some anyway," said Patsy Bonnett. We asked her how it felt having their name on the top of the list. "Doesn't bother me," Bonnett responded.

Bruce Bonnett would not come home, but called us while we were still there. We asked him if he has plans to pay the delinquent taxes.

"Time will tell," said Bonnett.

We asked Bonnett if he really owed $111 million dollars. He said to talk with his attorney, Larry Ehrman. Ehrman refused to comment.

Bonnett's former attorney, Stephen Jones, says those figures are exaggerated and inflated. They are based off estimates of Bonnett's income during the scams that landed him in prison.

Tax Commission officials say they cannot discuss details of individual tax warrants like Bonnett's. But they said every person with a tax lien has the opportunity to dispute the amount owed.

The Oklahoma Tax Commission admits most of the taxes on the list are "uncollectable". We asked the commission's spokesperson if the list is useless.

"Well I wouldn't say useless… I think as far as looking at those big dollar amounts and just thinking you're going to raise a hundred million and that will be beneficial, is not going to happen short term," said Ross.

Some on the list are cited for debt that really is uncollectable. Four of the top ten are corporations that no longer exist.

Miller Exchangers owes $2.2 million. But a former employee says the Sand Springs company went under in 1984 and the owner is dead. JWM Corporation is its parent company, also listed for $4.7 million.

Boecking Machinery out of Oklahoma City owes $2.2 million. It was dissolved after a scandal in the 1980s involving kickbacks for county commissioners.

Kron Computer Inc, an Oklahoma City computer store owes $2.6 million. It closed its doors in 1995 and the owner later filed for bankruptcy.

Tulsa tax attorney Paul Tom says the state will never get those millions because there's no way to collect them.

"The state of Oklahoma is left to collect money from an empty shell," said Tom.

The rest of the top ten are people, but have proven just as elusive. Robert and Patsy Sutton owe $2.4 million in income taxes. But their address is in Houston.

"I have never seen them go out of state to try to collect a debt... ever," said Tom.

Then there are Jay and Jennifer Jones, on the list for $2.5 million. Jay Jones served five years in prison after a scandal with Tulsa-based Commercial Financial Services. He currently works part-time as a clerk at the Brewster and DeAngelis law firm in Tulsa. His attorney says Jones has no assets for the state to collect.

5/12/2010 Related Story: One Of Oklahoma's Top Tax Delinquents Speaks Out

Tom thinks the top 100 list is just a gimmick and won't help.

"I just don't think it's going to be effective or accomplish any sort of purpose other than shaming the people and embarrassing the people who end up on the list," said Tom.

Attorney General Drew Edmondson says, in this kind of economy, the state must find new ways to collect the money it's owed.

"I think we should more aggressively pursue the obligations that are owed to the state of Oklahoma by delinquent taxpayers… literally hundreds of millions of dollars that are owed to the state," said Edmondson in a gubernatorial candidates forum in Tulsa.

Under Oklahoma law, it is not illegal to have unpaid taxes, no matter how much a person owes. But the state does charge 15 percent interest plus penalties and the tax lien does go against your credit score.

Number five on the list, Jay Jones, allowed us to interview him just before this story aired. He says he does not consider himself a tax cheat. We'll have his story Tuesday night.