| FOR IMMEDIATE RELEASE October 6, 2008 WWW.USDOJ.GOV/USAO/CAN |
SAN FRANCISCO – United States Attorney Joseph P. Russoniello and Special Agent in Charge, IRS Criminal Investigation, Scott O’Briant announced that Digna Roldan Garrett pleaded guilty to five counts of filing a false tax return. Theses guilty pleas are the result of an investigation by the Internal Revenue Service Criminal Investigation.
Ms. Garrett, 60, of Hayward, California, was charged on September 29, 2008 with five counts of filing a false tax return in violation of Title 26 U.S.C. § 7206(1). Under the plea agreement, Ms. Garrett pled guilty to all counts.
In pleading guilty, Ms. Garrett admitted that she was the President of Friendly Available Service Today Corporation (FAST), a nursing “temp” agency, since 1993. For the tax years 2002, 2003 and 2004 she under-reported corporate gross receipts totaling $1,117,219.13 on her corporate tax returns.
The false returns lead to a tax audit of Ms. Garrett’s corporate tax returns, during which it was discovered that Ms. Garrett treated some of her employees as contractors to avoid the related payroll taxes. In an attempt to hide the payments to employees, Ms. Garrett altered corporate ledgers and cancelled checks and presented the altered documents to the IRS Revenue Agent.
As the result of the audit, Ms. Garrett amended her 2002 and 2003 corporate tax returns but continued to hide income from the IRS. She deposited cash and checks from clients into her personal bank accounts. With some of the money she diverted from the company she purchased luxury items such as a Mercedes ML, purses, shoes, clothes and trips to Las Vegas, Nevada and the Philippines. However, most of the diverted funds were used to pay employees under-the-table.
The sentencing of Ms. Garrett is scheduled for January 9, 2009 before Judge Lowell D. Jensen in Oakland. The maximum statutory penalty for each count of filing a false tax
return in violation of Title 26 U.S.C. § 7206(1) is three years in prison and a fine of $250,000, plus restitution, if applicable. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Thomas Moore is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Kathy Tat. The prosecution is the result of an investigation by the Internal Revenue Service Criminal Investigation.
Further Information:
Case #:CR-08-0678-DLJ
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