Sources: Feds Drop Arriola Tax Investigation - NewsChannel5.com | Nashville News, Weather & Sports

NC5 Investigates: Davidson County Clerk

Sources: Feds Drop Arriola Tax Investigation

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By Phil Williams
Chief Investigative Reporter

NASHVILLE, Tenn. -- Former Davidson County Clerk John Arriola appears to be off the hook.

NewsChannel 5 has learned that federal prosecutors have now dropped an investigation into whether the former county clerk cheated on his taxes.

This comes six weeks after Arriola resigned his position to avoid prosecution on state criminal charges.

"He's resigned, and that's all behind us as far as I'm concerned," Davidson County District Attorney General Torry Johnson said back in June as he announced that Arriola had stepped down. 

In return, prosecutors agreed not to indict the county clerk on state charges that he illegally pocketed tens of thousands of dollars in cash for all those weddings he performed on taxpayer time.

Yet, a federal investigation had continued.

"There is no agreement whatsoever as far as the IRS or as far as the U.S. Attorney is concerned," Johnson said at the time. "We've had a number of conversations with both of those entities, but they are not involved in this at all."

Asked if the federal investigation continued, Johnson answered: "As far as I know, yes."

At the center of the Internal Revenue Service investigation was the question of whether Arriola had paid taxes on those fees that state auditors calculated at almost $120,000 over five years.

"I report that on my income tax," the clerk told NewsChannel 5 Investigates last year.

"Will you show us your income tax returns?" we asked.

"I don't have those," he insisted.

Metro Council member Charlie Tygard said earlier this year, ""When the government couldn't get Al Capone on any of the other actions, the IRS got him."

Tygard was one of the Council members who repeatedly pressed Arriola on whether he had paid taxes on the money before he was caught -- a question that one of the clerk's attorneys, Bryan Lewis, refused to answer directly.

"I'm answering your question, Councilman Tygard," Arriola lawyer Bryan Lewis said at one hearing. "I'm answering your question. Taxes have been paid, and he has no problems with the Internal Revenue Service."

"Were they amended?" asked Council member Robert Duvall.

"He has no problems with the Internal Revenue Service and all taxes have been paid," Lewis replied.

Arriola also hired prominent Nashville attorney George Barrett, who was a longtime mentor and former law partners with U.S. Attorney Jerry Martin. 

What role, if any, that Martin played in the final decision isn't known.

The U.S. Attorney's Office has repeatedly refused to acknowledge there ever was an investigation.

But individuals who know about how these things work say that, because this case involved a public official, it would be customary for the Justice Department in Washington to have approved the initial investigation -- and to be consulted on closing the case, as well.

One factor, they say, is that prosecutors may have just thought there wasn't enough money involved to warrant a criminal prosecution.

E-mail: pwilliams@newschannel5.com

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