FOR IMMEDIATE RELEASE
Wednesday, July 23, 2008
APRIL LYNN PALMER PLEADS GUILTY IN U.S. FEDERAL COURT
Bill Mercer, United States Attorney for the District of Montana, announced today that during a federal court session in Billings on July 23, 2008, before Senior U.S. District Judge Jack D. Shanstrom, APRIL LYNN PALMER, a 34-year-old resident of Billings, pled guilty to bankruptcy fraud. Sentencing is set for October 29, 2008. She is currently released on special conditions.
In an Offer of Proof filed by the United States, the government stated it would have proved at trial the following:
PALMER operated Total Class Escorts from her home in Billings. Customers located PALMER in the Billings Gazette or the local phone directory. PALMER would dispatch call girls as escorts. When the girls were dispatched, they would negotiate with the client regarding what services would be provided and how much would be charged for those services. Some of these calls resulted in payment for sexual acts. There was a base fee of $160 per hour.
The money collected for sexual acts was entirely retained by the escort, along with half of the hourly fee. The remaining cash was collected by PALMER. PALMER would either ask the escort to bring the money to her residence, or her significant other, K.S., would drive to a designated meeting place and obtain the cash for PALMER.
PALMER accounted for the cash garnered from the escort business by recording information regarding the escort calls in ledgers. Copies of these ledgers were seized pursuant to a search warrant and they provided cash flow information. K.S. has confirmed that these ledgers were created and maintained by PALMER and he did not have any involvement in maintaining the ledger.
In December 2002, PALMER filed for bankruptcy. In her supporting schedules, she indicated that she did not have any business income and only earned an income of $600 per month. However, the ledgers confirm that Total Class Escorts earned $35,967 in 2002. PALMER'S bankruptcy was discharged under Chapter 7 on April 22, 2003, and she thereby erased thousands of dollars of debt. However, in 2003 her business earned $61,845 which she never disclosed to the trustee. The trustee has stated that had he known about this income, PALMER never would have been discharged under Chapter 7 and he would have set up a payment plan with her creditors.
PALMER faces possible penalties of 5 years in prison, a $250,000 fine and 3 years supervised release.
Assistant U.S. Attorney Ryan M. Archer prosecuted the case for the United States.
The investigation was conducted by the Federal Bureau of Investigation.
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A copy of the Offer of Proof can be obtained by contacting Sally Frank at (406) 247-4638.
