In April 2017, we told you the incredible story of the talented singer/songwriter Richard Goldman and the LPs of his material that were put out without his knowledge. Both records were released as part of tax shelter deals in 1977. The albums are testaments to his knack for writing and performing clever, catchy songs, but in addition to not being asked if his works could be used on those records, Richard received no financial compensation. Forty-plus years later, these injustices are finally being righted with Numero Group’s issuing of Sweethearts Deluxe, the first authorized collection of Richard’s recordings that were included on tax shelter albums.
 

 
To celebrate the release, which is out today, we’re reposting part one of our 2017 article on Richard Goldman and the shady world of “tax scam records.”

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“Tax scam records” is a term that was coined by collectors to identify albums that are believed to have been manufactured for the sole purpose of—get this—losing money. From around 1976 until 1984, a number of record labels were established as tax shelters, with investors putting their money into albums. A financier would invest, say, $20,000 in an LP, and if it tanked, the backer could claim a loss on their taxes, based on the assessed value of the master recording. Technically, the practice was legal, but to maximize the write-off, the appraisal was often grossly inflated—as high as seven figures.

The I.R.S would come to question the legitimacy of some of these labels, and accuse those promoting shelters that focused on tax benefits—rather than the music being bankrolled—of perpetuating fraud.

Anything was seemingly fair game for a tax shelter album, including LPs previously issued as private press records, demo tapes by aspiring artists, and studio outtakes by name acts. Some labels were so brazen, they released albums using material by groups as big as Led Zeppelin and the Beatles.
 

Album of Beatles Christmas messages, 1981

Another issue that caught the attention of the I.R.S., was how little to no money was put into marketing these releases. Over time, collectors came to realize that relatively few copies of individual tax shelter albums had made it into stores. It’s believed that most of the LPs went directly to a warehouse or were simply destroyed. Many of these records are so scarce that only a handful of copies are known to exist.

Sometimes the artists knew about the release and were compensated, but more often than not, they had no idea. The singer-songwriter Richard Goldman is an artist in which the latter applies. Though getting ripped off isn’t unusual in the music business, his story is a fantastic one—even in the strange universe of “tax scam records.”

In late 1970, with dreams of making it in the music business, a 20-year-old Richard Goldman moved from his hometown of New Rochelle, New York to Los Angeles. “I wanted to be Jimmy Webb,” Richard told me recently (other inspirations include witty songsmith, Harry Nilsson; alt-country pioneer, Gram Parsons; and pop titans, the Beatles). His goal was to be a behind the scenes figure, thinking he would have a longer career as songwriter, rather than as a performer, as they tended to have shorter lifespans. But he wasn’t averse to playing his songs in public.
 

 
Richard became a fixture of the weekly open mic night at the Troubadour, then the hottest venue for singer-songwriters. After one such a set at the club, he was approached by an impressed member of the audience, Sam Weatherly, who became Richard’s manager and producer. Weatherly paid for demo sessions, which enabled Richard to record studio-quality versions of the songs he had been writing. For a session that took place at Sunset Sound, Weatherly brought in a musician by the name of George Clinton to play piano on a few tracks. Yep, the George Clinton.
 

 
Weatherly, who was older, “wasn’t just my manager,” Richard says today. “He was like a parent.” Richard would head over to Weatherly’s house often to have dinner, watch football, or play the board game Risk. Weatherly and his wife were like Richard’s west coast family.

In 1975, Richard recorded at the famed Sound City Studios. He’d actually recorded there a couple of years prior, and was invited back by one of the owners, Joe Gottfried. The engineer for the sessions, Fred Ampel, had taken on the managerial role in Richard’s career. By this time, Weatherly and Richard had drifted apart, though the circumstances are now unclear. Richard was thrilled to be recording again at Sunset Sound. “You knew you were in a very cool place.” Fleetwood Mac were right across the hall, and Lindsay Buckingham caught a playback of one of Richard’s songs, “Sinatra’s Car.” Buckingham expressed his admiration for the tune, noting that the bridge sounded Beatlesesque. He even lent a hand, overdubbing a bit of bass for a particularly tricky section of the track. “It was a thrill to watch,” remembers Richard. “He was ripped on pot but absolutely flawless on bass.”
 
Continues after the jump…

 
Yesterday, we told you about “tax scam records,” and the incredible story of Richard Goldman, the exceptional singer-songwriter who made the shocking discovery that two versions of an album—largely made up of his tunes—had been released without his knowledge. But that’s not the end of this strange tale. Decades had gone by, when Richard happened upon yet another LP of his songs, the vinyl pressed up by a similarly mysterious record company. How did this happen—again?
 

 
Sweethearts was released by Granya Records in 1977. The album was comprised of studio demos Richard recorded between 1971 and 1974. Sweethearts was distributed by Album World, a division of International Record Distributing Associates (a/k/a IRDA). Based in Hendersonville, Tennessee, IRDA was formed in 1974 by Hank Levine and Mike Shepherd, two record industry veterans. The year they opened for business, the pair told Billboard magazine that IRDA was an “association of small independent labels, with the strength and distribution of a major label.”
 

Billboard magazine clipping, 1975.

By 1977, IRDA was manufacturing tax shelter albums for a variety of labels, many of which seem to have been established solely to take advantage of the tax credit. Levine and Shepherd were responsible for creating the finished product and then distributing the records via their Album World and Album Globe subsidiaries. It isn’t known how many tax shelter albums Levine and Shepherd distributed, but it’s estimated to be well over 100 titles, including LPs of Beatles and Led Zeppelin material.
 

‘The Fantastic Dena Carrol,’ Lanark Records, 1977. Distributed by Album World. The cover art recalls both Marilyn Monroe and a certain Lou Reed LP. Note the price tag.

The conventional wisdom among collectors of “tax scam records” is that Levine and Shepherd sold tax shelters to investors and then created new, fake record labels for each release. But that wasn’t the case. What happened was, the labels—companies that were often established for one-time only tax shelter albums—came to Levine and Shepherd. In the tax shelter orbit, it was known that they could do the required work.

I spoke with Jack Millman, one of the biggest players in the tax shelter game. Millman had a trove of master recordings—obtained through various connections in the music industry—which he would sell to individuals who wanted to create a tax shelter album. He told me about the people in his circle, and that included Levine and Shepherd. As part of a 1985 federal case—in which the investor in a tax shelter record was denied tax credits related to said album—the court noted Millman had recommended the services of IRDA to the investor.

Album Globe distributed the tax shelter record comprised of Christmas messages recorded by the Beatles, but Levine and Shepherd were removed enough from the equation that neither they nor their companies are mentioned in the lawsuit filed by the group’s lawyers.

Granya Records was likely just another tax shelter label hipped to the professional services of Levine and Shepherd. Sweethearts is the only known Granya release. Who exactly was behind Granya is still unknown, though I have a hunch.
 

 
Through my research, I learned that Granya, Incorporated was established in 1975, listing a post office box in San Marino—a city in Los Angeles county—as their address. The owner of the company is also the CEO of a real estate agency in Southern California. I called the agency, and left messages requesting an interview on the CEO’s personal voicemail, but have yet to receive a response.

In 1977, the year Sweethearts was released, Granya, Incorporated was the only registered company in the United States using the name “Granya.”

But who provided the tape of Richard’s songs? Keep reading after the jump…

 
“Tax Scam Records” is a phrase that was coined by collectors to identify albums that are believed to have been manufactured for the sole purpose of—get this—losing money. From around 1976 until 1984, a number of record labels were established as tax shelters, with investors putting their money into albums. A financier would invest, say, $20,000 in an LP, and if it tanked, the backer could claim a loss on their taxes, based on the assessed value of the master recording. Technically, the practice was legal, but to maximize the write-off, the appraisal was often grossly inflated—as high as seven figures.

The I.R.S would come to question the legitimacy of some of these labels, and accuse those promoting shelters that focused on tax benefits—rather than the music being bankrolled—of perpetuating fraud.

Anything was seemingly fair game for a tax shelter album, including LPs previously issued as private press records, demo tapes by aspiring artists, and studio outtakes by name acts. Some labels were so brazen, they released albums using material by groups as big as Led Zeppelin and the Beatles.
 

Album of Beatles Christmas messages, 1981

Another issue that caught the attention of the I.R.S., was how little to no money was put into marketing these releases. Over time, collectors came to realize that relatively few copies of individual tax shelter albums had made it into stores. It’s believed that most of the LPs went directly to a warehouse or were simply destroyed. Many of these records are so scarce that only a handful of copies are known to exist.

Sometimes the artists knew about the release and were compensated, but more often than not, they had no idea. The singer-songwriter Richard Goldman is an artist in which the latter applies. Though getting ripped off isn’t unusual in the music business, his story is a fantastic one—even in the strange universe of “tax scam records.”

In late 1970, with dreams of making it in the music business, a 20-year-old Richard Goldman moved from his hometown of New Rochelle, New York to Los Angeles. “I wanted to be Jimmy Webb,” Richard told me recently (other inspirations include witty songsmith, Harry Nilsson; alt-country pioneer, Gram Parsons; and pop titans, the Beatles). His goal was to be a behind the scenes figure, thinking he would have a longer career as songwriter, rather than as a performer, as they tended to have shorter lifespans. But he wasn’t averse to playing his songs in public.
 

 
Richard became a fixture of the weekly open mic night at the Troubadour, then the hottest venue for singer-songwriters. After one such a set at the club, he was approached by an impressed member of the audience, Sam Weatherly, who became Richard’s manager and producer. Weatherly paid for demo sessions, which enabled Richard to record studio-quality versions of the songs he had been writing. For a session that took place at Sunset Sound, Weatherly brought in a musician by the name of George Clinton to play piano on a few tracks. Yep, the George Clinton.
 

 
Weatherly, who was older, “wasn’t just my manager,” Richard says today. “He was like a parent.” Richard would head over to Weatherly’s house often to have dinner, watch football, or play the board game Risk. Weatherly and his wife were like Richard’s west coast family.

In 1975, Richard recorded at the famed Sound City Studios. He’d actually recorded there a couple of years prior, and was invited back by one of the owners, Joe Gottfried. The engineer for the sessions, Fred Ampel, had taken on the managerial role in Richard’s career. By this time, Weatherly and Richard had drifted apart, though the circumstances are now unclear. Richard was thrilled to be recording again at Sunset Sound. “You knew you were in a very cool place.” Fleetwood Mac were right across the hall, and Lindsay Buckingham caught a playback of one of Richard’s songs, “Sinatra’s Car.” Buckingham expressed his admiration for the tune, noting that the bridge sounded Beatlesesque. He even lent a hand, overdubbing a bit of bass for a particularly tricky section of the track. “It was a thrill to watch,” remembers Richard. “He was ripped on pot but absolutely flawless on bass.”
 
Continues after the jump…