After an investigation that involved the Internal Revenue Service, U.S. customs officials and the Department of Homeland Security, John Kenneth Coil, 61, along with his wife, daughter, son and four other employees, was charged with the interstate transportation of obscene material and mail fraud, as well as withholding $4.5 million in taxes from the federal government.
On Friday, United State District Court Judge Harry Lee Hudspeth sentenced Coil to 63 months in federal prison and ordered him to pay a $5,000 fine and forfeit all business properties located in Texas.
“You break the rules, you cheat the federal government, you make millions selling this smut, and you don’t even pay your taxes to the tune of multi-millions of dollars, you will be held to account,” said U.S. Attorney Johnny Suttion.
According to Justice officials, Coil was the head of a three-state tax evasion scheme that involved placing properties in his children’s names without their consent and skimming money from his stores.
Coil also pleaded guilty to obscenity for the interstate transportation of hardcore German video “Nympho Bride,” a movie that federal officials referred to as “sadistic.”
“John Kenneth Coil has been a long time pornography merchant who has made millions selling obscenity and cheating on his taxes,” said Sutton. “He is finally on his way to federal prison for his crimes. American families have won a battle today in the fight against pornography.”
Seven other co-defendants were sentenced earlier by Hudspeth, including Coil’s business partner Charles Phelps Jr., also known as “Mr. D” and “Dave Smith,” who received 42 months in federal prison. Coil’s wife, daughter and son each received three years probation.
