Grasonville Accountant Convicted of Preparation of False Tax Returns
Baltimore, Maryland - After a seven-day bench trial, U.S. District Judge Richard D. Bennett convicted Joseph Poole, age 62, of Grasonville, Maryland, today of four counts of aiding in the preparation of false tax returns, in connection with a scheme to underreport the income earned and tax owed by a Baltimore City business owner, announced United States Attorney for the District of Maryland Rod J. Rosenstein.
“Willfully filing a false tax return is the same as stealing and there are serious consequences,” stated C. Andre' Martin, Internal Revenue Service-Criminal Investigation Special Agent in Charge. “Prosecuting individuals who intentionally prepare and file false tax returns is a vital element in maintaining public confidence in our tax system.”
According to trial testimony, between 1998 and 2003, Stilianos (Stan) Mavroulis, the President and 100 percent owner of Fidelity Home Mortgage Corporation (FHMC), diverted more than $1,100,000 of FHMC’s funds to pay for personal family expenses. Poole classified such personal expenses as business expenses in FHMC’s books, thereby fraudulently decreasing FHMC’s net profit figures as well as the income shown on Stan Mavroulis’ personal tax returns. The evidence also demonstrated that, between 1998 and 2003, Stan Mavroulis withdrew approximately an additional $700,000 from FHMC as shareholder draws that should have been reported as capital gains on his personal tax returns. Poole, who worked for an accounting firm headquartered in Annapolis, Maryland, prepared all of FHMC’s corporate tax returns and Stan Mavroulis’ personal tax returns for the relevant period. Judge Bennett concluded that Poole willfully prepared false personal tax returns for Stan Mavroulis for tax years 2000 through 2003, failing to report a total of more than $1,438,000 in income for Mr. Mavroulis in those years. For 2000 and 2001, Stan Mavroulis’ personal tax returns, as prepared by Poole, claimed the Earned Income Credit, despite the fact that Stan Mavroulis did not qualify for such credit. In addition, the evidence showed that Poole knew that Stan Mavroulis’ children were working at FHMC but were not on FHMC’s payroll and therefore were not reporting their income to the IRS; instead, the payments to the Mavroulis children were disguised within the approximately $700,000 in shareholder draws that were not reported on Stan Mavroulis’ tax returns.
Poole faces a maximum sentence of three years in prison on each of the four counts for aiding in the preparation of false tax returns. Judge Bennett has scheduled sentencing for October 16, 2009 at 2:00 p.m.
Stan Mavroulis, age 65, and his son, Kirk Mavroulis, age 27, both of Baltimore, previously pleaded guilty to related charges. Stan Mavroulis pleaded guilty on January 26, 2009, to filing a false individual income tax return, and is scheduled to be sentenced on September 30, 2009, at 9:00 a.m. Kirk Mavroulis, who was the head of FHMC’s accounting department, pleaded guilty on January 22, 2009, to failing to file an individual tax return that should have reported the income he received from FHMC and which was disguised as shareholder draws to Stan Mavroulis. He was sentenced to probation and a $9,000 fine on May 22, 2009.
United States Attorney Rod J. Rosenstein thanked the Internal Revenue Service - Criminal Investigation for their investigative work. Mr. Rosenstein commended Assistant United States Attorneys Stephen M. Schenning and Jonathan Biran, who are prosecuting the case.