A federal grand jury in Alaska has indicted an Anchorage plastic surgeon on seven felony counts of wire fraud for allegedly smuggling millions of dollars to Panama to hide it from his wife during divorce proceedings.
Dr. Michael Brandner, 64, is accused of taking more than $4 million to Panama in 2007 and 2008 and filing false court documents during his divorce, claiming he loaned the money to a foreign entity and could not pay it to his wife of 28 years, Sheila Brandner, who was leaving him.
In 2011, Brandner sneaked the money back into the United States and "invested" it in a shell corporation, federal prosecutors say. Authorities seized Brandner's hidden millions in California, where the money remains tied up in civil proceedings as federal prosecutors sue to have it forfeited.
Brandner is a longtime private-practice plastic, burn and hand surgeon who does work out of Anchorage hospitals. His state occupational license as a physician in Alaska is valid until the end of 2014. Brandner was arrested Wednesday, and state court records show he remained jailed Friday.
Nobody answered the phone Friday at Brandner's offices near 36th Avenue and Lake Otis Parkway.
As far as Alaska court records are concerned, the trouble in the Brandners' marriage began in 1998. Brandner's wife, Sheila, filed for four domestic violence restraining orders against him and sought a divorce. Though the divorce was later set for a three-day trial, the Brandners, at least in public, settled their differences out of court and apparently remained married.
But their troubles continued. Brandner's wife filed again for a restraining order and divorce in 2007. According to the indictment filed Thursday, 2007 is when Brandner had five cashier's checks drawn from his account in Alaska and -- without telling friends, family or coworkers -- drove from Alaska to Panama. That's a road trip of roughly 7,000 miles. He deposited the checks in Panama with Dakota Investment, the indictment says.
An accomplice who turned against Brandner, named only as a "cooperating witness" in the federal civil case over the money, "began cooperating with the government in connection with a separate investigation of a stock-fraud scheme," according to the complaint in that case. The unnamed accomplice told agents he warned Brandner about filing tax paperwork for the money, but Brandner did not file it, according to the charges in the civil case. The accomplice told federal agents that after the checks Brandner also had $1 million transferred to an account at California-based Pensco Trust Company, which held his retirement funds. Through Pensco, Brandner had the money wired to the account in Panama, the indictment says.
With the more than $4 million in Panama, Brandner then lied to his attorney, the state of Alaska and his soon-to-be ex-wife in court, saying the money was invested in Panama in an "arm's-length" deal and therefore not something Sheila was entitled to in the divorce, according to the indictment. Brandner actually had complete control over the funds, the indictment says.
In phone call agents recorded with the accomplice that year, Brandner learned of a tax treaty between Panama and the U.S. that could affect the proceedings in the divorce, the civil complaint says. Brandner then put the accomplice to work setting up Evergreen Capital. He opened an account for the sham company at a Bank of America branch near Seattle Tacoma International Airport, the complaint says. He set up Evergreen to be held by someone outside the country, but Brandner had full control over the account, according to the complaint.
The Brandner's divorce was granted in 2011, according to state court records. Though Brandner said the money invested in Panama would be available in 2013, he later claimed it had been lost, according to the indictment.
"The purpose of the continued deceit was for Brandner to keep the money he had removed from the country for his own personal use," the indictment says.
Federal authorities later seized the $4.6 million in the account.
Agents arrested Brandner in Anchorage on Wednesday.
Brandner could face up to 20 years in prison and a $250,000 fine. Federal prosecutors continue to pursue the surgeon's millions in federal court in California.