Chiropractor used fake trusts to hide income, avoid $1.3M in federal taxes

A Puerto Rican chiropractor and former chief executive of a company that managed more than 50 chiropractic clinics across the Midwest pleaded guilty Monday to filing a false tax return in connection with an illegal tax shelter he used to conceal income and avoid paying nearly $1.3 million in federal taxes, prosecutors said.

Stuart Bernsen, formerly of Westmont, Illinois, was the co-founder and former chief executive of a company that managed a network of more than 50 chiropractic clinics across the Midwest, according to court documents and statements made in court. Between 2019 and 2021, Bernsen paid to establish an illegal tax shelter built around a series of abusive trusts and a fraudulent charitable foundation, prosecutors said.

The scheme was designed to create the appearance that Bernsen had permanently transferred ownership of his business interests — including his chiropractic company — to the trusts and charitable foundation. In reality, prosecutors said, Bernsen retained control of those entities and continued benefiting from the income they generated.

Bernsen used the trusts to fund an array of personal expenditures, including personal residences, credit card bills, a luxury vacation and a boat, according to court documents. He also filed false tax returns for the trusts, falsely claiming those personal purchases were deductible administrative expenses, prosecutors said.

Bernsen pleaded guilty to one count of willfully filing a false tax return. He is scheduled to be sentenced Oct. 2 and faces a maximum of three years in prison. A federal district court judge will determine the sentence after weighing the U.S. Sentencing Guidelines and other statutory factors.