The former head of an energy service company pleaded guilty to misappropriating $18.5 million in taxable profits to invest them in a mining operation in the Congo Republic. On Jan. 4, 2017, the man agreed to pay $670,000 as restitution for New York state taxes he evaded in 2006, 2007 and 2008. He also admitted to state felony charges of offering a false instrument of filing and tax fraud.
The defendant was the sole shareholder of Glacial Energy Holdings, which had been incorporated in Nevada. According to prosecutors, a wholly owned subsidiary of the company, Glacial Energy of New York, pleaded guilty to tax fraud in December 2015. The defendant also sent money to banks in China, South Africa, Liechtenstein and Switzerland. He then claimed the amounts as consulting expenses on the subsidiary's tax forms.
The New York attorney general and the acting state tax commissioner released a joint statement that said in return for his guilty plea and payment of half of the restitution, the charges against him would be dropped. The man agreed to settle the other half of the restitution by filing a judgment against himself at a benefit to the state tax agency.
The statement also asserted that the defendant demonstrated a disregard for the integrity of the New York tax system and the residents of the state who would have been left with the bill. The attorney general further stated that individuals who try to avoid paying their share of taxes will be caught and held accountable, regardless of how elaborate their tax scheme.
Tax fraud charges, whether state or federal, should be taken very seriously, as the consequences if a conviction is obtained can be quite severe. People who are facing them may want to have the help of an attorney in seeking an agreement with the prosecutor that could provide for restitution in whole or in part as an alternative to incarceration.