Feds indict well-known lawyers, adult bookstore owner

Tax fraud allegations target porn impresario for filing false returns and hiding real estate proceeds, accuse lawyers and a former IRS agent of aiding in schemes

Email | Print By Richard Lawson

Nashville porn king Jerry C. Pendergrass has been indicted on charges of federal income tax evasion, filing false tax returns and conspiracy to defraud the government. Facing charges along with him are attorneys Alan L. Saturn and Alan D. Mazer, partners in a long-established Nashville law firm and real estate title insurance company.

Also facing charges in the tax case is, interestingly, an ex-IRS man. James M. Hammond, a former special agent with the Internal Revenue Service Criminal Investigation Division, allegedly assisted Pendergrass in creating false corporate and personal tax returns.

Pendergrass, who has had plenty of trouble with the law over his adult entertainment businesses over the years, owns, among others, the highly visible "World's Largest Adult Bookstore" along Interstate 40 at the edge of downtown.

The indictment charges Pendergrass for skimming cash receipts and rental income from his 822 Corp., which owns the World's Largest Adult Bookstore. Pendergrass also filed false tax returns from 1999 to 2000, failing to report $3 million in additional income and claiming $400,000 in false and fraudulent deductions, according to the indictment.

In 1999 and 2000, Pendergrass had two federal tax liens against him for a total of $565,876. The indictment claims Saturn and Mazer were involved in a ruse to hide Pendergrass' ownership in residential property at 1049 Hickory Hollow Road. The two title attorneys allegedly prepared paperwork to facilitate the hidden ownership so that the IRS could not come after it as a way to satisfy the liens.

Pendergrass bought the property in 1996 but never recorded the deed. He then sold the property to a third party in 2000. He was paid $300,000 in the sale. Pendergrass, however, was still the owner through the third party and Saturn and Mazer knew it, according to the indictment. The indictment alleges Pendergrass did this to avoid paying the tax liens.

Neither Saturn nor Mazer could be immediately reached for comment.

The indictment alleges that Hammond conspired with Pendergrass to prepare fraudulent balance sheets for corporate returns and false financial statements for Pendergrass and 822 Corp.

Saturn is known locally as a supporter of the arts, along with his wife Nancy, who has operated the American Artisan craft boutique on Harding Road for more than 30 years.

Mazer has a long history of involvement in community volunteer work, having chaired a past capital campaign locally for Special Olympics and organized projects on behalf of Habitat for Humanity.