The Indictments in Taxes Over a Three -Year Period by Filing Clothing, Money Orders and Airline Tickets
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ble -Huff Records Inc., North Bay Records 21 times. However, it was not clear how charging them with improper use of cor- Inc., Gamble Records, Huga Management many stations or individual station per- porate funds. Inc. and Cheyenne Productions Inc. -as sonnel were involved in each city. The New York tax indictments say well as officials of those companies. Nor was there any reliable indication of nothing about payola. Mr. Davis is They were said to have paid some the kind of stations involved. Although charged with evading more than $45,000 $37,000 to radio station personnel in cash, the companies named in the indictments in taxes over a three -year period by filing clothing, money orders and airline tickets. are among the leaders in 'rhythm and blues false tax returns. The indictment said he The clothing -more than $6,000 of it, ac- music, investigators cautioned against received $690,000 in salary during 1970, cording to the indictment -allegedly was drawing the inference that personnel at 1971 and 1972, but failed to report an ad- provided by Krass Brothers Clothiers of black- oriented stations had been the ditional $90,000 in goods and services he Philadelphia, one of whose owners, Ben- record companies' primary target. They allegedly received from CBS. These in- jamin Krass, is a partner in Gamble noted that top -40 stations also play the cluded, according to the indictment, Records and named in the indictment. music involved. $15,000 in travel accommodations and According to the indictment, station Officials of the companies named in the vacations, $52,000 in payments for an personnel from a number of states were Philadelphia indictment were Kenneth apartment renovation, a bar mitzvah given airplane tickets to travel to Philadel- Gamble, who at various times was presi- reception valued at more than $17,000, a phia to pick up the clothing. The indict- dent of the six companies indicted; Leon $4,000 car and a $900 wristwatch. For the ment also said the defendants drew up Huff, Earl Shelton, Joseph Medlin, Ed- most part these are the items listed by CBS lists of the station personnel to whom they ward Richardson (also known as Lord in court a suit it has filed in which it is would pay money -in currency -and the Gas), Harry Coombs and Mr. Krass. seeking to recover $94,000 from Mr. amount they would pay each, some In Los Angeles, the grand jury returned Davis (BROADCASTING, June 4, 1973). $25,000 in all. Another $3,200 was paid in an indictment charging Fred Rector, a The income tax charge filed against Mr. the form of money orders. record promoter with offices in Chicago Wynshaw said he attempted to evade The indictment listed 16 cities in which and Los Angeles, with failing to file in- more than $110,000 in taxes by filing false station personnel allegedly received come tax returns for 1972 and 1973. returns. The indictment said the alleged payola -Norfolk, Va.; Chicago; Detroit; The indictment naming Mr. Davis pro- offenses occurred from 1969 to 1972. Inkster, Mich.; New York; Atlanta; St. vided an ironic touch to the announce- Despite the six -count indictment and its Louis; Memphis; Washington and two of ments last week. It was a Justice Depart- threat of 30 years in prison and $60,000 in its suburbs, Oxon Hill, Md., and District ment investigation into the activities of fines, Mr. Davis, who is now president of Heights, Md.; University City, Mo.; Mr. Davis and Mr. Wynshaw two years Arista Records, seemed to regard the Houston; Philadelphia; Baltimore and ago that led to the grand jury probes amid government action as a kind of vindica- Cleveland. reports that not only payola but "drugola" tion. He issued a statement asserting his In most of those cities, according to the was involved. An additional layer of con- innocence and noting that none of the indictment, illegal payments were made troversy was added at the time when CBS charges linked him with payola or drugola. frequently -in Washington, for instance, fired both Mr. Davis and Mr. Wynshaw, "For two years my family and I have Who's who in the indictments A rundown on recording- industry figures named by the grand juries Clive Davis can lay claim to being the recording industry's most visible figure. As president of Columbia Records and later of the CBS Records Group between 1967 and 1973, he built a roster of com- mercial and artistic successes unsurpassed by any other label. Dismissed just over two years ago and charged with improper use of CBS funds, Mr. Davis has been Taking It on the chin. Three of the bigger record industry names named in payola -related fighting those charges in a civil suit indictments last week (I -r): Clive Davis, ousted head of CBS Records now president of Ar- brought by CBS. He returned to the indus- tista Records, and Kenny Gamble and Leon Huff, who oversee Philadelphia International Records. try as a consultant to Bell Records in 1974, taking over as president late last year by federal investigators in 1973, had also Richardson, national field representative; when the label changed its name to Arista. been linked to Mr. Wynshaw by that in- Harry Coombs, label operations director, His operations at Arista have yet to take vestigation. and Joseph Medlin and Benjamin Krass, on the dramatic quality of some of his The rise of Philadelphia as a leading also with the label. moves at CBS, but he has done much to challenger to Detroit's dominance of Brunswick and its Dakar subsidiary, develop Barry Manilow and Melissa popular soul music may be attributed in both headed by Nat Tarnopol, have also Manchester, his leading new artists, into large part to Kenneth Gamble and his been forces in soul music, with some suc- commercial successes. partner, Leon Huff. Their Philadelphia In- cess in pop cross -overs as well. The David Wynshaw was vice president for ternational label and Gamble-Huff Pro- ChiLites have been the label's biggest artist relations for Columbia Records ductions, through a distribution arrange- sellers in recent years, with Tyrone Davis before being fired just before Mr. Davis's ment with CBS Records, have brought and Bohannon also consistent chart per- discharge in early 1973. Mr. Wynshaw such artists as the O'Jays, MFSB and the formers. allegedly told federal investigators that Three Degrees to the top of pop and R &B Named in the indictment in addition to $250,000 in payola was paid by CBS charts. Lately the label has begun to diver- Mr. Tarnopol were Brunswick executive Records to radio station personnel, a sify somewhat, recording white groups vice president Peter Carris, controller Irv- charge that was never substantiated. such as the Soul Survivors. ing Weigan, artists & repertoire vice presi- Pasquale Falconio, who worked for an Indicted were Messrs, Gamble and dent Carl Davis, promotion director independent artist management firm and Huff, Earl Shelton, vice president for bus- Melvin Moore, and Lee Shep and Car- was linked to a drug -smuggling operation iness affairs for the label; Edward mine De Noia, also with the label. Broadcasting Jun 30 1975 28 .