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Harry Edward Thomas was sentenced in federal court to five years' imprisonment, a $10,000 fine and five years of probation.

Thomas' sentencing follows his conviction on Oct. 2, 1990, by a jury of 16 counts of aiding and assisting in the preparation of false tax returns.In 1982 through 1984, Thomas, formerly of Sandy, and now residing in Pinedale, Wyo., promoted and operated fraudulent tax shelters.

He instructed others at his companies, National Fund, Inc., and its various affiliates, to inflate partnership assets in order to create excessive and false tax deductions consisting of depreciation and investment tax credits.

In one partnership, named Big Sky Leasing Ltd., Thomas purchased 20 horses costing a total of $12,400. He sold the horses to the partnership at a cost of more than $2.7 million, accomplished through a series of paper transactions between Thomas. The action caused both partnership and investors' tax returns to be false.

Judge Aldon J. Anderson, who presided over the trial and sentencing, determined that the tax losses caused by Thomas in the criminal charges alone amounted to in excess of $2 million.

"Those who willfully violate the internal revenue cause honest citizens to pay higher taxes and contribute greatly to the federal deficit. Anyone who commits tax fraud will be prosecuted to the full extent of the law."