Former New Mexico State Contractor Sentenced for Evading Federal Taxes
ALBUQUERQUE – Shelda Sutton-Mendoza, 60, of Albuquerque, N.M., was sentenced this morning to ten months of home confinement with electronic monitoring followed by three years of supervised release for her federal tax evasion conviction. Sutton-Mendoza also was ordered to pay $167,362.00 in restitution to the IRS.
Sutton-Mendoza was indicted in Dec. 2011, and charged with five counts of tax evasion. At the time of the crimes charged in the indictment, Sutton-Mendoza was owner and sole shareholder of NYSNC Environmental, Inc. (NYSNC), an environmental clean-up and testing service established in 2000 and incorporated in Oct. 2003. NYSNC contracted primarily with the New Mexico Environmental Department, where Sutton-Mendoza was employed in the Petroleum Storage Bureau for more than six years before leaving to establish NYSNC. The indictment charged Sutton-Mendoza with evading federal personal and corporate taxes during tax years 2003, 2004 and 2005 by intentionally filing false tax returns that misrepresented her personal and corporate taxable income.
In March 2013, Sutton-Mendoza pled guilty to Count 1 of the indictment and admitted evading federal taxes. In her plea agreement, Sutton-Mendoza admitted that she routinely used NYSYNC funds to pay for personal expenses. In 2003 and 2004, she used more than $70,000.00 in company funds to pay for a custom designed in-ground swimming pool with custom mosaic murals and more than $200,000.00 in company funds to pay for personal clothing, handbags and cosmetics. Sutton-Mendoza also admitted that paying for personal expenses with company funds rendered the money taxable as personal income to her, and that she knowingly concealed from the IRS the extent of both NYCYNC’s and her taxable income.
Sutton-Mendoza admitted that for tax years 2003 and 2004, she signed and filed false personal and corporate federal tax returns which omitted significant personal and corporate income. She acknowledged intentionally filing a false tax return for NYSYNC for calendar year 2003 in which she reported only $1,447,855.00 of the company’s gross income of $1,803,844.52, and thus evaded $17,021.00 in federal taxes. Sutton-Mendoza also intentionally evaded $76,660.00 in personal income taxes for calendar year 2003 by underreporting her gross income of $261,152.00. For calendar year 2004, Sutton-Mendoza reported only $851,998.00 of NYSYNC’s gross income of $1,138,090.02, and thus evaded $2,121.00 in federal taxes. She also intentionally evaded $71,560.00 in personal income taxes in calendar year 2004 by underreporting her gross income of $250,580.00.
The case was investigated by IRS Criminal Investigation and was prosecuted by Assistant U.S. Attorney Mary L. Higgins.