US drops remaining tax charge against Castroneves

MIAMI (AP) " Federal prosecutors dropped the remaining tax evasion conspiracy charge against two-time Indianapolis 500 champion Helio Castroneves and his sister on Friday, clearing the Brazilian driver of all the charges that once threatened to derail his career.

Castroneves, 34 and one of the favorites for Sunday's Indy 500, and his 35-year-old sister Katiucia, were acquitted of other tax evasion charges by a jury April 17. His tax lawyer, Alan Miller of Michigan, also was cleared of all wrongdoing.

The jury failed to agree on the conspiracy charge, resulting in a mistrial on that count. Now prosecutors have decided not to pursue a retrial on that charge, which carries a maximum prison sentence of five years.

In Indianapolis, Castroneves described learning of the dismissal as "incredible" and "amazing." In addition to having the fastest practice time Friday, Castroneves won the pit stop competition.

"Things are falling into place. I'm just so glad I had a fair trial and I'm here racing again," said Castroneves, one of Indy racing's most popular and successful drivers.

The driver, who vaulted to even greater worldwide fame by winning TV's "Dancing With The Stars" competition in 2007, said he was glad to be focusing again on racing.

"My life is back," he said. "The only thing I can think about is to go and be in the race car again."

The Castroneves' lawyers, Roy Black and Howard Srebnick, said it would have been illogical to try them again on a conspiracy charge when they were found innocent of the underlying tax evasion counts. Black also made a reference to Castroneves' "Spiderman" practice of scaling racetrack fences after his victories.

"The jury finds him not guilty, then he wins the pole position at Indy, and now the government drops the case completely," he said. "All he has to do now is win the race and climb the fence."

Miami U.S. Attorney R. Alexander Acosta declined comment beyond his office's terse one-paragaraph dismissal order that was signed by U.S. District Judge Donald Graham, ending the criminal case.

The Castroneves siblings and Miller had faced about six years in prison had they been convicted. The Internal Revenue Service claimed they plotted to evade some $2.3 million in taxes using a Panamanian shell corporation and supposedly crooked dealings with a former Castroneves sponsor, the Brazilian firm Coimex.

Castroneves' lawyers contended all along that the Coimex deal was legitimate and that he simply set up a deferred income account in the Netherlands for $5 million he was paid by Penske Racing under a contract signed in 1999. When that account comes due, Black said Castroneves will pay his U.S. taxes as he intended all along.

Castroneves resumed racing immediately after the court case ended, finishing seventh in Long Beach, Calif., and second at a race in Kansas. Now he's a favorite at the biggest race of them all.


AP national sports writer Paul Newberry in Indianapolis contributed to this report


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