| FOR IMMEDIATE RELEASE September 11, 2009 WWW.USDOJ.GOV/USAO/CAN |
SAN FRANCISCO - Kenneth E. Hayes was sentenced Wednesday to credit for time served, with six months home confinement followed by three years of supervised release, and ordered to pay restitution in the amount of $20,754.90 for filing a false tax return and maintaining a place for the distribution of marijuana, announced United States Attorney Joseph P. Russoniello.
Hayes pleaded guilty on April 29 to Counts Two and Thirteen of a superseding indictment that charged him with using a place for the manufacture and distribution of marijuana and filing a false federal income tax return for the tax year 2000. Hayes admitted that he organized the Harm Reduction Center LLC in June of 2000 as a limited liability company under California state law. The Harm Reduction Center operated in two locations – 1017 Howard Street and 52 6th Street in San Francisco. Hayes organized the Harm Reduction Center for the purpose of running a medicinal cannabis dispensary where marijuana was packaged and sold. He accepted responsibility for cultivating 99 plants at the 6th Street address.
Hayes also admitted that he filed a false federal income tax return for tax year 2000. Specifically, he admitted that he did not report any income from the Harm Reduction Center LLC when in fact there were gross receipts of at least $70,000. He admitted to omitting net income of $25,000 and agreed to a tax loss of $7,386. He also agreed that he was liable for the Fraud penalty imposed by the Internal Revenue Code.
Hayes, 41, was charged in a superseding indictment on October 12, 2006.
Kim Briggs is the Assistant U.S. Attorney who is prosecuting the case, with the assistance of Cynthia Daniels. The prosecution is the result of an investigation by the Internal Revenue Service - Criminal Investigation and the Drug Enforcement Administration, working together under the Organized Crime Drug Enforcement Task Force (OCDETF).
Further Information:
Case #: CR 02-0053CRB
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