WASHINGTON – A Newport News, Va., federal grand jury has indicted a married couple for conspiring to defraud the United States, the Justice Department and the Internal Revenue Service (IRS) announced today. The grand jury indicted Kathryn Charles Miles and John Scott Miles of Mathews County, Va. In addition, Kathryn Miles is charged with filing false tax returns, and John Miles is charged with failing to file tax returns. The court has not yet set a trial date.
According to the indictment, Kathryn and John Miles jointly operated a construction business called "Scotts Construction" and "KCM Construction & Design," out of their residence. Kathryn Miles, a nurse, filed six false tax returns for tax years 2000 through 2005 and attached false documents to each tax return. Additionally, according to the indictment, John Miles did not timely file tax returns with the IRS for tax years 2004 and 2005. In 2001, Kathryn Miles and John Miles paid $200 to American Rights Litigators, a business that sold and promoted tax defiance schemes. An indictment merely alleges that a crime has been committed, and a defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Kathryn Miles faces a maximum of 23 years in prison and a maximum fine of $1.75 million. If convicted, John Miles faces a maximum of seven years in prison and a maximum fine of $350,000.
The case is being investigated by IRS Criminal Investigation and is being prosecuted by Assistant U.S. Attorney Brian Samuels and Tax Division Trial Attorney Justin K. Gelfand.
More information about the Justice Department’s Tax Division and its enforcement efforts is available at www.usdoj.gov/tax/.