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A Mooresville man was convicted today of tax fraud following a three day jury trial

FOR IMMEDIATE RELEASE
March 12, 2012

United States Attorney Anne M. Tompkins Western District of North Carolina

FORMER US AIRWAYS PILOT CONVICTED OF TAX FRAUD Charles A. Davis was convicted of ten counts of filing false tax returns and one count of obstructing the Internal Revenue Service CHARLOTTE, N.C. – A Mooresville man was convicted today of tax fraud following a three day jury trial, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina. U.S. District Judge Richard L. Voorhees ordered that Charles A. Davis, 63, remain in federal local custody pending his sentencing in this matter.

U.S. Attorney Tompkins is joined in making today’s announcement by Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service - Criminal Investigation Division (IRS-CI).

According to the indictment and evidence presented during trial, Davis was employed as a commercial airline pilot for US Airways from 1983 through November 2011. Davis did not file timely income tax returns for 1996 through 2007 despite receiving wages ranging from $129,950 to $190,510. For years 1997 through 2005, Davis’s employer withheld little or no federal income tax from his wages because Davis previously had falsely represented that he was exempt from income tax withholding. According to evidence presented at trial, in April 2006 Davis filed five fraudulent amended income tax returns for 1996 through 2000, falsely claiming that he earned little or no adjusted gross income in each of those years. Subsequently, from April 2008 to February 2009, Davis filed five fraudulent individual income tax returns for 2004 through 2008, reporting false amounts of federal income tax withheld for each of those years and requesting fraudulent refunds from the IRS in amounts up to approximately $1.5 million.

Trial evidence established that during the IRS’s efforts to collect Davis’s tax debt, Davis obstructed and impeded the IRS in numerous ways, including submitting fraudulent payment documentation to the IRS and concealing his assets and income in a nominee bank account. Davis also took various steps to avoid IRS levies on his US Airways payroll account and his bank accounts, including filing for bankruptcy and diverting funds to his 401(k) account.

According to the indictment and evidence presented during trial, Davis used a fraudulent address in Texas to avoid paying state income taxes. He currently owes the North Carolina Department of Revenue in excess of $150,000.

The evidence also showed that during the time he failed to pay his taxes, the defendant drove a Ferrari and a Mercedes, and lived in a lakefront home on Lake Norman.

“As we rapidly approach April 15th, most citizens take their obligations seriously and file accurate tax returns,” said U.S. Attorney Tompkins. “Individuals like the defendant, who try to cheat the system by evading their taxes and by filing fraudulent tax returns seeking bogus refunds, face criminal prosecution, significant prison sentences, and paying back the money they owe.”

“The jury found Charles Davis guilty of filing false tax returns and now he has to suffer the consequences,” said IRS Special Agent in Charge Hammett. “Willfully filing false tax returns is the same as stealing.”

Judge Voorhees has not yet set a sentencing date. Davis faces a maximum potential sentence of 33 years in prison and a maximum fine of $2,750,000.

The case is being prosecuted by Assistant U.S. Attorney Jenny Grus Sugar and Tax Division Trial Attorney Jonathan R. Marx. The case was investigated by the IRS, Criminal Investigation Division.


 

 

 

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