On December 18, 2009, in Seattle, Wash., Michelle L. Bielaski, of Bellevue, Washington, was sentenced to 15 months in prison, two years of supervised release, and ordered to pay $2,478,002 in restitution. Bielaski pleaded guilty in June 2009, admitting that as secretary and treasurer of Falcon Construction, Inc., she failed to send to the Internal Revenue Service taxes that the company withheld from employee paychecks. In her plea agreement, Bielaski admitted that the construction company had the ability to pay the withheld taxes over the years and in fact had paid salaries totaling approximately $3.9 million from 1998 to 2007.
Archive for the ‘Collection Nightmares’ Category
Washington State Woman Sentenced for Failing to Pay Employment Taxes
Tuesday, August 10th, 2010Learn From This Man’s Mistakes!
Friday, June 11th, 2010I often wonder how a person gets to the point where they’re running from the IRS. I’m sure that most people don’t start off in business saying to themselves: “I’m going to start a business and defraud the government out of tax money”.
But yet, over time, it still happens. Consider this True Story, from the IRS Website:
“On April 25, 2006, in San Francisco, CA, Lee Nobmann, the CEO and owner of Golden State Lumber (GSL), was sentenced to 15 months in prison, fined $40,000 and ordered to pay $330,000 in restitution.
Nobmann pleaded guilty on Dec. 8, 2005, admitting that he had his company pay for his personal expenses and deduct the funds as the company’s business expenses from 1996 to 2000.
Nobmann also acknowledged that he received rebate checks from vendors and deposited them into his personal bank account and did not report the payments as income for the company or as income on his personal income tax returns.”
I don’t have any inside information about this case. All I know about it is what you just read. But still, reading stories like this always makes me wonder what happened over the 4-year period from 1996-2000, when this man started having his company pick up his personal expenses and claiming them as business expenses.
Did he not know that he was making a big mistake? Did the Chief Financial Officer try to warn him about this from the beginning?
When he started depositing checks into his bank account from vendors into his personal account…did he think that he wouldn’t get caught?
5 Years Go By…I Wonder If I’m Going to Get Away With It?
The other interesting thing about this case is that it says he was sentenced to prison in 2005 for something that happened from 1996-2000. Five years go by…seems like a long time.
I wonder what he was thinking from 2000 until 2005? He had 5 years where he knew he had defrauded the government out of tax money … but yet he was still a free man. Did he think he was going to get away with it?
Was he constantly looking over his shoulder, wondering if the IRS was going to “jump out of the bushes?” Did he ever read a blog like this one – encouraging him to do the right thing … before it’s too late? So if he was being warned, why did he ignore the warnings?
Texas Doctor Sentenced For Tax Evasion
Tuesday, May 25th, 2010On September 29, 2009, in Texarkana, Texas, Malcolm David MacHauer was sentenced to 33 months imprisonment, to be followed by three years of supervised release, and ordered to pay restitution in the amount of $222,782. MacHauer was found guilty by a jury on June 17, 2009, of three counts of attempting to evade and defeat paying federal income taxes. According to information presented in court, although MacHauer received income from Wadley Medical Center in Texarkana, Texas, for his services as a doctor, he failed to pay the appropriate federal income taxes. Instead, MacHauer placed his income into his corporation, transferring the money to the MacHauer Family Trust, and then withdrawing money from that Trust to pay his personal expenses without paying income tax.
Owner of North Hollywood Restaurant Sentenced for Tax Evasion
Tuesday, May 11th, 2010On October 2, 2009, in Los Angeles, Calif., James Saliba, owner of a North Hollywood restaurant, Barsac Brasserie, was sentenced to 24 months in prison, three years supervised release, and ordered to pay restitution and fines totaling more than $938,000 for failing to report all of the restaurant’s business receipts and overstating business expenses from 2001 through 2005. According to court documents, Saliba underreported the gross sales of Barsac by using an account he called “Accrued Management Fees”, where he recorded some of the sales. He also overstated expenses by writing corporate checks from Barsac to his wife, Lisa Long, and then deducting these payments as expenses on the returns for the restaurant and by writing checks to “Cash” and expensing them as tips; giving a small portion to employees while skimming the balance for himself.
Cincinnati Doctor Receives Two-Year Sentence for Money Laundering
Friday, April 30th, 2010On January 19, 2007, in Cincinnati, OH, Gregory L. Ebner was sentenced to serve 24 months in prison, followed by three years of supervised release and ordered to pay a $10,000 fine for his role in a money laundering and structuring a money transactions scheme relative to the proceeds he received from prescribing controlled substances. Ebner was a physician who worked in the “pain clinics” two to three days a week and saw around 30 patients a day. Ebner prescribed drugs after cursory medical examinations in which he never checked the height, weight, or blood pressure of his patients. The “pain clinics” would not accept insurance or any other form of payment. Patients paid cash in amounts ranging from $175 to $200 per patient. Ebner took the illegal “pain clinic” proceeds and laundered and structured these funds in order to conceal and hide his involvement in this illegal activity.
Former Wisconsin Restaurant Owner Receives Prison Term for Evading Income Taxes
Thursday, April 8th, 2010On February 27, 2008, in Madison, Wis., Sabi Atteyih was sentenced to 12 months plus one day in prison, to be followed by a three year term of supervised release for income tax evasion.
On January 2, 2008, Atteyih pleaded guilty to evading his income taxes for 2002. While owning the Casbah Restaurant in Madison, Atteyih underreported his taxable income from the restaurant from 2002 through 2005 by $349,673 and he evaded income taxes totaling $128,938.
Couple Sentenced on Conspiracy and Tax Evasion Charges
Saturday, March 13th, 2010On November 16, 2006, in Erie, PA, Ronald J. and Carol A. Kapala were sentenced for conspiring to defraud the United States by impeding and impairing the lawful functions of the Internal Revenue Service. Ronald Kapala was sentenced to 30 months in prison to be followed by three years of supervised release and ordered to pay a $100 assessment. Carol Kapala was sentenced to three years probation and ordered to pay a $300 assessment. According to the indictment, the Kapalas failed to file income tax returns from 1990 through 1998 and 2002 through 2004; attempted to conceal their construction business activity through the use of nominee names; disguised ownership of assets by transferring them out of their names; formed a bogus tax-exempt religious organization for the construction business in the name “Mission Builders,” and made fraudulent claims with the IRS concerning their obligation to pay federal income taxes.
Ex-restaurant Owner Sentenced to Prison for Tax & Bankruptcy Fraud
Saturday, February 20th, 2010On February 15, 2008 in San Diego, Calif., Karl James, the former owner and operator of more than 50 Taco Bell franchises in southern California and Arizona, was sentenced to serve 36 months in prison and ordered to pay $1.12 million in restitution to the victims of his bankruptcy fraud and $1.17 in restitution to the Internal Revenue Service (IRS) for unpaid taxes. James pleaded guilty on October 19, 2005 to bankruptcy fraud and tax evasion. He admitted that from May 2, 1998, through June 5, 2001, he fraudulently diverted more than $3 million in GWT income and assets for his personal use, including beverage and food supplier rebate checks issued to GWT and expensive residences purchased with the company’s funds.
Dentist Sentenced for Hiding $300,000 in Income from IRS in Offshore Bank Accounts
Thursday, February 18th, 2010On February 23, 2007, in San Jose, CA, Roy Albert Lewis, a dentist from Danville, CA, was sentenced to 24 months in prison and three years of supervised release. Lewis was convicted of conspiring to defraud the United States and evading his income taxes from 1998 through 2001. According to the indictment and evidence introduced at trial, in approximately 1995, Lewis became a client of Tower Executive Resources, a Denver organization that promoted a tax evasion scheme involving the use of false invoices and secret offshore bank accounts. Lewis’ medical practice paid bogus expenses to Tower to generate false tax deductions. Tower then deposited the bulk of the funds into a secret offshore bank account that Lewis controlled. Over a 10 year period, Lewis sent approximately $300,000 to a secret offshore bank account through the Tower system.