Two Corporate Execs Plead Guilty In $630,000 Federal Tax Evasion
CHARLESTON, W.Va. – U.S. Attorney Booth Goodwin announced today that two top senior executives of an employment staffing agency that operated in West Virginia both pleaded guilty to federal employment tax evasion charges. Daniel Hovis, 60, president of Career Search One, Inc., pleaded guilty today to failure to pay trust fund taxes to the IRS for employees. The corporation’s vice president, Janice Hensley, 63, also pleaded guilty to failure to pay trust fund taxes to the IRS.
Hovis and Hensley together failed to pay more than $600,000 in federal employment taxes that were owed to the IRS.
Career Search One, Inc. specialized in providing employees to client businesses for a fee. The corporation’s primary bookkeeping offices were based in Charleston and Wheeling, West Virginia. Hovis and Hensley both worked out of the Charleston location.
From 2004 through the first quarter of 2010, Hovis and Hensley withheld trust fund taxes from many employees’ paychecks. The trust fund taxes were monies that were owed to the IRS. Hovis and Hensley each failed to report or pay over trust fund taxes that they had previously withheld from employees’ wages. Trust fund taxes are withheld federal income and Federal Insurance Contribution Act (“FICA”) taxes, which also include Social Security and Medicare taxes. Career Search One, Inc. failed to pay these taxes.
From 2004 through the first quarter of 2010, Hovis and Hensley failed to report and pay over approximately $630,158.94 in trust fund taxes to the IRS on behalf of Career Search One, Inc.’s employees. Hovis and Hensley used the monies to pay personal expenses. Both executives knew that the corporate funds should have been used for the payment of trust fund taxes.
Hovis and Hensley each face up to five years in prison and a $250,000 fine when they are sentenced on September 4, 2013 by United States District Judge Thomas E. Johnston.
The Internal Revenue Service, Criminal Investigative Division conducted the investigation. Assistant United States Attorney Meredith George Thomas is in charge of the prosecutions.