O.C. Man Whose Company Provided Military Support Services In Iraq Pleads Guilty To Tax Offenses For Failing To Report Millions In Income
SANTA ANA, California – The owner of a Huntington Beach-based military contractor has pleaded guilty to federal tax charges for failing to report to the Internal Revenue Service millions of dollars his company received for providing services to the military at Baghdad International Airport.
Nadim “Nick” Saifan Jr., 48, who resides in Huntington Beach, pleaded guilty late yesterday to two counts of attempted tax evasion. Saifan pleaded guilty to two of the five counts contained in an indictment returned by a federal grand jury in 2011.
Saifan specifically pleaded guilty to substantially underreporting income on his company’s 2005 corporate tax return and his personal tax return for 2006.
Saifan was the owner and operator of Defense Logistical Support & Services Corporation (DLSS), which provided services to the military and some civilian companies in Iraq. From August 2004 through October 2007, DLSS received nearly $16 million from the United States military alone for services in Iraq, according to court documents that state Saifan reported only a small fraction of this income on DLSS’s corporate tax returns filed with the IRS.
In addition to failing to report millions of dollars of corporate income, Saifan also used DLSS funds to pay for personal expenses without reporting this money as personal income. Federal prosecutors alleged in court papers that defendant used corporate money to make approximately $880,000 in down payments on real estate and approximately $292,000 in payments towards vehicles that included a Ferrari and a Rolls-Royce.
Prosecutors preparing for trial wrote that Saifan owes at least $4.5 million in unpaid corporate and personal taxes for the several years charged in the indictment, and that he caused a total tax loss to the government of at least $7 million.
Saifan pleaded guilty before United States District Judge Cormac J. Carney, who is scheduled to sentence the defendant on August 18. At sentencing, Saifan will face a statutory maximum sentence of 10 years in federal prison.
After Saifan pleaded guilty yesterday, Judge Carney revoked Saifan’s bond and remanded him into federal custody pending his sentencing.
The case against Saifan was investigated by the Defense Criminal Investigative Service and IRS – Criminal Investigation.
Release No. 14-054