A former executive of an energy company entered a guilty plea to diverting $18.5 million in profits to a foreign company in order to evade New York state taxes. The agreement was entered into on Jan. 4 in New York Supreme Court.
The man, an Australian citizen, was the former chief executive officer and the only shareholder of Glacial Energy Holdings, a company that is incorporated in Nevada. In his plea, he agreed that he would pay $670,000 in restitution for taxes that he admitted evading in the tax years of 2006 through 2008. In December 2015, Glacial Energy of New York, a wholly owned subsidiary, also pleaded guilty to tax fraud in the state.
Under his plea, the charges against him will be dismissed in exchange for his payment of half of the restitution amount. He also agreed to repay the remaining half by entering a judgment against himself on behalf of the state's tax agency. Authorities say that the man diverted the money to a mining operation in the Democratic Republic of Congo by funneling it through a series of bank accounts in Lichtenstein, Switzerland, China, South Africa and the DRC.
When people learn that they are the subject of a state or federal tax fraud investigation, they may want to proceed with retaining an attorney before any indictment has ever been handed down. In some cases, a criminal defense attorney may be able to negotiate a deal for a client to pay restitution in exchange for no charges being filed. If an indictment has been issued, an attorney may work to resolve the client's case as favorably as possible.
Source: Bloomberg, "Energy executive admits to hiding $18.5M from N.Y. tax agency," John Herzfeld, Jan. 5, 2017