Greek Shipping Magnate Ktistakis Denied Bond

IRS-superJumboA Greek shipping magnate, Lucas Ktistakis, 77, who remains a fugitive more than a decade after his indictment in New Orleans in 2003 on tax-related charges, will not be allowed to go free on bail if he returns to the U.S. from Greece, where he now lives.

A federal judge will review a ruling granting bond for Ktistakis. U.S. Magistrate Alma Chasez ordered Lucas Ktistakis released from pretrial detention on $400,000 bond on September 12. However, U.S. District Judge Helen Berrigan later stayed that order pending her own review.

Prosecutors had objected to Chasez’s decision, claiming the 77-year-old dual citizen of Greece and the United States poses a risk of fleeing the country. He was arrested in Germany in February and fought his extradition for six months before he was returned to the U.S.

A four-count indictment in January 2003 accuses Ktistakis and his wife, Kathryn, of purchasing more than $500,000 worth of cars and property in Greece with money diverted from their companies, including New Orleans-based Sunrise Shipping Agency Inc, without reporting it as income to the Internal Revenue Service (IRS), as reported in the Columbus, Indiana newspaper, The Republic.

Last month, Ktistakis pleaded not guilty. “The defendant lives in Greece and has for the past decade,” a prosecutor, Hayden Brockett, wrote in a court filing seeking a review. “Greece does not extradite for tax offenses, which is the subject of the present indictment,” Brockett added.

Ktistakis’ attorney, Billy Gibbens, said in a court filing last week that his client has reached a tentative plea agreement with prosecutors to resolve the case. Gibbens said that Ktistakis is prepared to pay more than $1.5 million in restitution to the IRS as part of a deal that still needs the Justice Department’s final approval so that he can come back to the U.S. Brockett said the government’s proposed plea agreement calls for Ktistakis to serve three years in prison, according to The Republic.

Ktistakis and his wife were residents of Metairie, Louisiana, from 1989 through 1997 before moving to Chagrin Falls, Ohio. Gibbens said his client had been living in Greece for more than five years at the time of his indictment. Brockett said Ktistakis knew he was under investigation when he left the U.S., as reported in The Republic.

“His exact wealth is difficult to quantify, which is a direct result of his efforts to conceal his income from the United States government by moving and maintaining funds offshore,” Brockett wrote.