Former escort guilty in tax evasion caseby Heather Knight
A graduate of Stanford Law School who became a professional escort using the stage name "Brazil" pleaded guilty in federal court on Monday to tax evasion.
In a plea agreement, Cristina Warthen, 35, admitted she operated an escort business in which she traded sex acts for money.
She ran a Web site where she offered paid memberships, posted erotic photos of herself and advertised her services, pricing and travel schedule.
She admitted that in 2003, she grossed more than $133,000, bringing in a net income of $81,797. She owed federal taxes amounting to $24,424 but acknowledged in the plea taking steps to hide her income, such as storing cash in a safe deposit box and buying postal money orders in amounts low enough to avoid filing a currency transaction report.
The maximum penalty for tax evasion is five years imprisonment and a fine of $100,000, but under the plea agreement, Warthen will be sentenced to three years probation including one year of home confinement. She also agreed to pay the U.S. Treasury $313,133.74, the equivalent to the proceeds from her escort service.
Warthen was previously known as Cristina Schultz and graduated from Stanford Law School in 2001. She formerly lived in Palo Alto and Oakland, but now lives in Los Angeles. She is the wife of David Warthen, co-founder of Ask.com.
The plea is the result of an investigation by the Internal Revenue Service with the assistance of the Postal Inspection Service. She faced no prostitution charges.
"This is a case where she had illegal income and she didn't report it," said Special Agent Arlette Lee of the IRS criminal investigation division. "If she reported it properly, she probably wouldn't have been looking at a tax charge."
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