News

Business Owner Pleads Guilty to Income Tax Evasion and Structuring Banking Transactions to Avoid Reporting Requirements


Structured $684,287 in Over Five Years to Avoid Bank Reporting Requirements;
Did Not Report $243,679 in Income on his Tax Return

FOR IMMEDIATE RELEASE
September 11, 2008

Baltimore, Maryland - William Endy, age 69, of Easton, Maryland, pleaded guilty today to income tax evasion and structuring money transactions to evade banking reporting requirements, announced United States Attorney for the District of Maryland Rod J. Rosenstein.

“In furtherance of his tax evasion scheme, William Endy omitted $243,679 of income from his federal tax returns over four years, and he broke up deposits of more than $684,287 into smaller amounts in an effort to avoid bank reporting requirements,” stated U.S. Attorney Rod J. Rosenstein. “People who cheat on their taxes shift the cost to honest taxpayers.”

“IRS-CI has increased its investigation of individuals who structure financial transactions to hide their income and ultimately evade taxes. Currency reports are evaluated to trace the money from the criminal activity to the criminal,” stated C. Andre' Martin, Internal Revenue Service-Criminal Investigation Special Agent in Charge.

According to his plea agreement, from August 2002 to 2005, Endy cashed and deposited checks received for his produce brokerage business, Just A Mere Trading Company (JAMTC) in a manner that attempted to evade federal income tax obligations for those tax years. Endy began his tax evasion scheme when he attempted to cash a check made out to his business. When his bank told him it would not cash a business check, he opened a new personal account and directed his largest customers to make their checks payable to him personally, instead of to JAMTC. Thereafter, Endy cashed 203 out of 216 of his business-receipt checks that were written for less than $10,000; whereas he deposited all 213 of his business-receipt checks that were written for more than $10,000. Endy used some of the cash to buy cashier’s checks payable to his suppliers. As such, Endy prevented a large portion of the business activity of JAMTC from appearing on his bank statements. Endy provided his tax preparer with JAMTC profit and loss statements that did not include the income from the cashed checks or the expenses from the cashier’s checks.

Endy also deducted personal expenditures as business expenses on his tax returns and failed to declare income he received from cashing checks for another individual, as described below.

Through these means, Endy failed to report more than $243,679 for the tax years 2002, 2003, 2004 and 2005, thereby evading $59,703 in taxes.

Moreover, from 2002 to 2006 in another scheme, Endy structured cash transactions to evade requirements that banks report any cash transaction exceeding $10,000. In addition to structuring cash transactions involving his own company’s funds, on more than 40 occasions Endy received pairs of checks from Company A totaling $10,500. Typically, the checks were sequentially numbered, written on the same date and delivered to Endy in a single envelope. For every pair, Endy cashed the two checks on separate days or at separate bank locations in order to avoid the bank’s reporting of these transactions to the IRS. Endy then returned $10,000 in cash to Company A, keeping $500 for himself. Endy did not report these $500 amounts as income on his federal tax returns, including at least $10,500 in 2003.

From 2003 to 2006, Endy fraudulently structured about $684,287 to avoid bank reporting requirements.

Endy faces a maximum sentence of 10 years in prison for structuring transactions and five years in prison for tax evasion. U.S. District Judge William D. Quarles, Jr. has scheduled sentencing for April 10, 2008 at 9:30 a.m. As part of his plea agreement, Endy has agreed to pay $59,703, plus interest, in taxes owed to the IRS, as well as a fraud penalty.

 

United States Attorney Rod J. Rosenstein thanked the Internal Revenue Service - Criminal Investigation for their investigative work. Mr. Rosenstein commended Assistant United States Attorney Michael J. Leotta, who is prosecuting the case.

 

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