Cleveland financial planer Rao Garuda sentenced in illegal tax shelter scheme

WASHINGTON (WJW) — A Cleveland financial planner who federal authorities said promoted a fraudulent tax shelter scheme to high-income clients has been sentenced to prison and ordered to pay $1.5 million in restitution.

Rao Garuda, president and CEO of Associated Concepts Agency Inc., promoted the “Ultimate Tax Plan” or “Advanced Legacy Plan,” in which clients got tax breaks for charitable donations of assets that they never actually donated, according to a news release from the U.S. Department of Justice.

“Garuda continued to sell the scheme despite being warned by several attorneys that the scheme was illegal,” the DOJ said in the release.

When federal investigators subpoenaed Garuda’s clients, he created false, backdated documents and told clients to submit them to the Justice Department, according to the release.

A federal judge sentenced Garuda to 20 months in prison, with three years of probation to follow, and ordered him to pay $1.5 million in restitution.

The plan was organized and marketed by Garuda’s co-conspirator Michael Meyer, who was sentenced to eight years in prison on April 10.

Associated Concepts’ COO Cullen Fischel was also sentenced to four months in prison and ordered to pay $268,605 in restitution.