WASHINGTON – Reynaldo Orozco pleaded guilty to one count of filing a false tax return before U.S. District Court Judge Adalberto Jordan in the Southern District of Florida, the Department of Justice and the Internal Revenue Service (IRS) announced today. The court set sentencing for June 17, 2011.
According to court documents, during tax years 2004 through 2007, Orozco owned and operated Rock Construction Builders Inc. (RCB), a construction business located in Miami-Dade County, Fla. Orozco issued RCB corporate checks to various other corporations holding them out to be legitimate subcontractors. In truth, these corporations did not perform work for RCB. Orozco cashed the checks at local check cashing stores and used the bulk of the cash obtained in this manner to pay RCB employees. Orozco failed to report the cash wages on quarterly employment tax returns and failed to withhold and pay employment taxes on the wages. From 2004 through 2007, RCB failed to report approximately $3,294,426 in cash wages to the IRS.
Court documents also stated that on Feb. 11, 2005, Orozco made and subscribed to a false IRS Form 941 (Employer’s Quarterly Federal Tax Return) for the quarter ending Dec. 31, 2004. Orozco knew this return was false because it failed to report the substantial cash wages paid to RCB employees that quarter.
Based on the conduct described above, the U.S. Treasury suffered an employment tax loss of approximately $504,047. Orozco faces a maximum of three years in prison.
Wifredo A. Ferrer, U.S. Attorney for the Southern District of Florida, and John A. DiCicco, Principal Deputy Assistant Attorney General for the Department of Justice’s Tax Division, commended the IRS special agents who investigated this case and Tax Division Trial Attorneys Matthew J. Mueller and Gregory E. Tortella, who prosecuted the case.
Additional information about the Justice Department’s Tax Division and its enforcement efforts may be found at www.usdoj.gov/tax.