Success Story Ends With a Prison Term

A San Diegan from a prominent Point Loma family who was voted by his high school graduating class most likely to succeed is scheduled this week to begin serving a three-year jail term for his part in a massive tax and bank fraud.

John Landon, 40, is scheduled to surrender himself Oct. 14 to authorities to begin serving the sentence handed down last month by a U. S. district court judge in New York. Landon had pleaded guilty in June, 1987, to one count of tax fraud and two counts of fraud in connection with his role as director and shareholder of Heritage Bank & Trust in Salt Lake City.

Illegal Tax Deductions

Landon was “an extremely close confidant and business associate” of John Peter Galanis, the central figure in a tax syndication scheme that spurred investors to take $172 million in illegal tax deductions, said Assistant U. S. Atty. Vincent L. Briccetti of the Southern District of New York in Manhattan.

Landon’s two weeks of testimony during Galanis’ trial, which ended in July, was taken into consideration by the federal judge who handed down Landon’s sentence, Briccetti said. Galanis received a 27-year jail term Sept. 28, but is now free on bail pending appeal.

Landon was president of Transpac Drilling Ventures, a Salt Lake City investment firm that the government said was actually controlled by Galanis. The 80 or more limited partnerships that Landon helped set up not only deprived the Internal Revenue Service of $172 million through bogus tax deductions but also bilked about 2,500 investors out of $40 million, the government alleged.

Most of the $40 million ended up being diverted for Galanis’ personal use, according to the charges. Neither Landon nor his attorney, John J. Tigue, was available for comment Monday.

Made False Statements

As a central figure in Heritage Bank & Trust, Landon made false statements to state and federal regulators after taking control in January, 1984, according to Briccetti. He also helped obtain $4.5 million in fraudulent loans from the bank.

Heritage was closed by the Utah Banking Commission in April, 1987, and is now in receivership and in the hands of the Federal Deposit Insurance Corp.

Landon is the son of Morris (Brick) Landon, a former commodore of the San Diego Yacht Club and executive at M. H. Golden Co., the city’s largest general contractor. A 1966 graduate of Point Loma High School, Landon was described by classmates as athletic, charming and an intellectual. He attended Stanford University.

Landon reportedly had a passion for expensive racing yachts. Although he lived in Utah over most of the past decade, he kept a sleek $400,000 yacht named Kathmandu docked at the San Diego Yacht Club.