Real Estate Businessman Convicted of Tax Fraud by Concealing Income Using Nominee...

Real Estate Businessman Convicted of Tax Fraud by Concealing Income Using Nominee Entities and Aliases

WASHINGTON, D.C. – February 2, 2015 – (RealEstateRama) — A federal jury sitting in Providence, Rhode Island, convicted a Cranston, Rhode Island, man of one count of corruptly endeavoring to obstruct and impede the Internal Revenue Service (IRS), one count of tax evasion and two counts of aiding and assisting in the preparation and filing of false corporate tax returns, the Justice Department and the IRS announced.

John Fall was remanded into custody after the jury verdict. Fall faces a statutory maximum sentence of 14 years in prison and a $1 million fine at his sentencing on April 28 before U.S. District Judge John J. McConnell Jr. for the District of Rhode Island.

According to the evidence presented at trial, Fall was a real estate consultant who bought, sold and brokered real estate. Fall also participated in handling the financial affairs of his wife and her businesses, including her dental practice, Comfort Dental Inc., and Broad Street Investments. Between 1999 and 2010, Fall used numerous nominee entities and business names to conceal his business and financial transactions. Fall also used multiple bank accounts, including commingled or “warehouse” bank accounts, in at least six states to conceal his financial transactions, as well as certain financial transactions of Comfort Dental and Broad Street Investments. To further disguise business and financial transactions, Fall used fake names and aliases to conceal his ownership and control over his nominee entities.

The evidence at trial proved that Fall filed false federal income tax returns for 1998 and 1999, and failed to file any tax returns for the years 2000 through 2010. The IRS audited Fall for 1998 through 2000, assessing him taxes totaling approximately $72,000.

The evidence at trial further established that Fall caused the filing of false tax returns on behalf of Comfort Dental for the years 2005 through 2007. Fall caused his wife’s businesses to make payments to his various entities which were falsely recorded on the corporate tax returns as deductible business expenses. When Comfort Dental and Fall’s wife were audited civilly by the IRS in late 2008, Fall attempted to obstruct the audit by encouraging his wife’s accountant not to provide the IRS with information requested through an IRS summons, and instead provided false and fraudulent information and documentation to the IRS concerning the nature of the payments by Comfort Dental and Broad Street Investments to his various entities. Fall also attempted to obstruct his wife’s compliance with an IRS summons.

This case was investigated by special agents with the IRS – Criminal Investigation. The case is being prosecuted by Assistant Chief John Kane and Trial Attorney Jeffrey Bender with the Justice Department’s Tax Division.

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