WASHINGTON - John D. Stacey, a resident of Phoenix, was convicted today of income tax evasion, corrupt interference with the due administration of the Internal Revenue Service (IRS) and multiple counts of fraudulent use of a social security number, the Department of Justice and IRS announced. A federal jury convicted Stacey of all counts of the indictment following a three week trial before Judge Neil V. Wake in Phoenix.
Stacey was indicted by a federal grand jury in July 2008. According to the evidence presented at trial, Stacey operated a sole proprietorship asphalt paving company that did business under various names, including A to Z Paving, Triple A Paving, Texas Paving, Pave Your Way Construction and A to Z Paving Engineering, among others. Stacey earned gross income in excess of $4 million from his business during the years 2000 to 2003, but he has never filed an individual income tax return with the IRS.
According to the evidence presented at trial, since at least February 2002, Stacey knew that he owed taxes, penalties and interest for tax years 1995, 1996 and 1997. Stacey has made no payments to the IRS towards this tax debt. In addition to not paying his outstanding tax debt, Stacey took numerous steps to frustrate the IRS’s efforts to both investigate the case and collect tax that he owed. For example, Stacey made multiple false statements to IRS agents, operated his business to prevent creating business records, made a number of luxury purchases rather than paying his outstanding tax debt and provided paving customers and financial institutions with multiple false social security numbers to prevent the IRS from receiving accurate information about his income, assets and financial transactions.
Judge Wake scheduled sentencing for Sept. 28, 2009. Stacey faces a maximum sentence of five years in prison for the tax evasion charge; a maximum sentence of three years in prison for the corrupt endeavor charge; and a maximum sentence of five years in prison for each false social security charge. Additionally, Stacey faces a fine of $250,000, for each charged count.
Acting Assistant Attorney General John A. DiCicco of the Justice Department’s Tax Division commended the IRS-Criminal Investigation special agents who investigated the case, as well as Tax Division trial attorneys Ellen Quattrucci, Monica Edelstein and Stephanie Carowan, who prosecuted the case. Acting Assistant Attorney General DiCicco also thanked the U.S. Attorney’s Office in Phoenix for their assistance in successfully prosecuting this matter.