WASHINGTON – Charles Alexander Davis formerly of Mooresville, N.C., was indicted by a federal grand jury in Charlotte, N.C., on 10 counts of willfully filing materially false tax returns and one count of obstructing and impeding the Internal Revenue Service (IRS), the Department of Justice and the IRS announced. The indictment was returned on May 19, 2011, and was unsealed today in U.S. District Court for the Western District of North Carolina.
According to the indictment, Davis’s employer, an international airline carrier, withheld little or no federal income tax from Davis’s wages for years 1997 through 2005 because Davis previously had falsely represented that he was exempt from income tax withholding. The department said, in April 2006, Davis filed five fraudulent amended income tax returns for 1996 through 2000, falsely claiming that he earned little or no adjusted gross income in each of those years.
The indictment further alleges that subsequently, from April 2008 to February 2009, Davis filed five fraudulent individual income tax returns for 2004 through 2008, reporting false amounts of federal income tax withheld for each of those years and requesting fraudulent refunds from the IRS in amounts up to approximately $1.5 million. During IRS efforts to collect Davis’s tax debt, the indictment alleges, Davis obstructed and impeded the IRS in numerous ways, including submitting fraudulent payment documentation to the IRS and concealing his assets and income in a nominee bank account.
Davis had his initial appearance on May 20, 2011, in Puerto Rico, where he was apprehended.
If convicted, Davis faces a maximum potential sentence of 33 years in prison and a maximum fine of $2.75 million. An indictment is merely an allegation, and Davis is presumed innocent unless and until proven guilty beyond reasonable doubt in a court of law.
The case is being prosecuted by Assistant U.S. Attorney Jenny Grus Sugar and Tax Division Trial Attorney Kevin C. Lombardi. The case was investigated by the IRS-Criminal Investigation Division.
More information about the Department of Justice’s Tax Division and its enforcement efforts can be found at www.usdoj.gov/tax.