Federal Jury Finds Area Man Guilty of Filing False Joint Tax Returns by Intentionally Under-Reporting Income
PITTSBURGH, Pa. – After deliberating less than three hours, a federal jury of nine men and three women found a DuBois man guilty of three counts of filing false tax returns following a three-week trial, United States Attorney Scott W. Brady announced on Friday.
Gary E. Mills, of DuBois, was tried before Senior United States District Judge Nora Barry Fischer in Pittsburgh, Pa.
“People who lie about their income on their taxes steal from the citizens of western Pennsylvania who work hard and play by the rules,” said U.S. Attorney Brady.
“My office is strongly committed to promoting compliance with federal tax laws, and will draw on all available law enforcement tools to identify, prosecute and punish tax cheats.”
“This guilty verdict confirms that all income is taxable, no matter what the source of the income is,” said Guy Ficco, Special Agent in Charge of IRS-Criminal Investigation.
“The verdict should also be a message to others who may be considering not reporting all of their income and paying their fair share of taxes that they too could face criminal prosecution by doing so. The Special Agents of IRS-CI will continue to investigate and recommend prosecution against those who cheat the tax system and victimize the honest taxpayers.”
The evidence presented at trial established that on April 15, 2015, April 15, 2014, and August 1, 2014, Mills filed false joint tax returns by intentionally under-reporting his and his wife’s income to the IRS.
During the trial, evidence was presented that the Defendant’s wife embezzled $12.9 million from Matthews International from 1999 to 2015. The Defendant’s wife embezzled more than $4 million during the 2012-2014 tax years. The Defendant allegedly believed the monies came from gambling. However, in April 2012, the Defendant received a Notice of Deficiency from an IRS civil audit focused on the 2003-2007 tax years. The Notice of Deficiency informed the Defendant and his wife that he owed more than $930,000 in back taxes, penalties, and interest for the years in question. While litigating and settling this civil audit, the Defendant offset gambling winnings with gambling losses resulting in approximately $100,000 in taxable income for each of 2012, 2013, and 2014 tax years, which resulted in approximately $15,000 in taxes per year. During these years, the Defendant spent approximately $2.7 million dollars, which included a $600,000 yacht, another large recreational boat, various luxury and recreational vehicles, and lavish vacations.
Judge Fischer scheduled sentencing for December 12, 2019, at 9:00 a.m. The law provides for a total sentence of nine years in prison, a fine of $750,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed is based on the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Shardul Desai prosecuted this case for the government.
Pending sentencing, the court continued Mills on bond.
The Internal Revenue Service and the U.S. Postal Inspection Service conducted the investigation that led to the prosecution of Mills.
Copyright © 2019 EYT Media Group, Inc. All rights reserved. Any copying, redistribution or retransmission of the contents of this service without the express written consent of EYT Media Group, Inc. is expressly prohibited.