Five members of a prominent San Joaquin County family were arraigned Friday and have agreed to plead guilty to federal tax charges stemming from years of pocketing unreported cash proceeds from their fruit packing and exporting operation, one of California's largest.
Lawrence Sambado, 70, and his wife Beverly, 71, their sons Timothy, 45, and Richard, 43, and Timothy's wife, Marie Josee Dusablan-Sambado, 42, are charged in five informations filed March 21 by prosecutors Benjamin Wagner and Matthew Segal.
Lawrence, Timothy and Richard Sambado are charged with filing false income tax returns, Beverly Sambado is charged with structuring monetary transactions with financial institutions so as to avoid federal reporting requirements imposed on the institutions, and Marie Dusablan-Sambado is charged with aiding in the structuring.
They are scheduled to plead guilty April 25 before U.S. District Judge Garland E. Burrell Jr.
Their undoing grew out of the separation of Richard and Anne Sambado. In January 2004, during their divorce proceedings, she and her lawyer walked into the Internal Revenue Service and spun a mesmerizing tale of skimming, according to court papers.
Anne Sambado told the IRS of her own use of cash and cashier's checks totaling in the tens of thousands of dollars to decorate her home, buy pool and spa supplies and pay for stays at resorts in Carmel Valley and Hawaii.
Subsequent investigation by the IRS turned up the family's cash expenditures for foreign travel, household maintenance, home improvements, food, clothing, child care and housekeeping services, court papers say.
They say many of these outlays showed up on the Sambado brothers' corporate books as business expenses, some labeled "packing labor" and "shipping labor."
Some $341,738 in corporate checks were used to build a Stockton home for Timothy and Dusablan-Sambado but, when Anne Sambado's lawyer made a demand for documents in connection with the divorce proceedings, the checks were transferred from the company's expense accounts to a loan account for Timothy Sambado, the records say.
The Sambados own and operate a large plant in Linden, a tiny community 13 miles northeast of Stockton. The plant houses Prima Frutta Packing Inc., a fresh fruit packer owned by the brothers that packs and ships about 30 percent of the state's annual apple crop; Primavera Marketing Inc., a marketer and shipper of fruits, nuts and vegetables owned by the elder Sambado and his sons and a fourth partner; and A. Sambado & Son, Inc., the family's original farming enterprise owned now solely by Lawrence Sambado.
According to court papers, Lawrence and his father, Alex Sambado, farmed together in the Linden area, but by the early 1980s their joint venture had become "a ranch packer of cherries, apples and walnuts."
Lawrence and Beverly "then decided to transform the … operations to compete directly in the world export markets."
As part of their plea deals, the five family members will be required to make restitution to the government and file amended tax returns. But much of the taxes on unreported income will never be recovered because it is impossible to calculate how much was skimmed over the years and spent for personal benefit.
In addition, much of the skimming falls outside the statute of limitations on federal tax crimes.
It will be up to the IRS to negotiate a settlement with the family.
Court papers say the money at issue was derived from sales of "peddler fruit," fruit of inferior quality that does not meet U.S. Department of Agriculture standards. Peddlers – often operators of roadside stands – went to the plant and paid cash for this fruit, mostly cherries and apples.
Call The Bee's Denny Walsh, (916) 321-1189.
