U.S. Department of Justice
United States Attorney
District of Rhode Island
February 24, 2010
Businessman sentenced for Tax Evasion and Bankruptcy Fraud Failed to pay more than two million dollars in back taxes
Steven Allard, 47, of Scituate, Rhode Island, was sentenced today to 30 months in prison having pled guilty in July 2009 to one count each of Tax Evasion and Bankruptcy Fraud. The sentence, announced by U.S. Attorney Peter F. Neronha, was imposed by U.S. District Court Chief Judge Mary M. Lisi.
At the time of his guilty plea, Allard admitted that between March, 2005, and July, 2006, he failed to pay employment taxes to the IRS for two of his companies, Builders Resources Delaware and Quad, in the amount of $2,139,739. He also admitted that in October and November, 2005, he made false statements in a personal bankruptcy petition and during the bankruptcy creditor’s hearing where he failed to disclose his ownership of property in Warwick, Rhode Island.
The Internal Revenue Service and the Federal Bureau of Investigation conducted the investigation.
At a plea hearing in July 2009, Assistant U.S. Attorney Andrew J. Reich told the Court the government could prove that Allard operated a number of related companies, including Builders Resources, Inc.-Delaware; Quad Company, Inc.; Builders Resources, Inc.- Massachusetts; and Eaglewood Realty, LLC. BRI-MA was in the business of constructing steel commercial buildings.
At the direction of the defendant, income generated from BRI-MA was transferred to other companies controlled by Allard, including BRI-DE, Quad and Eaglewood. The payroll for construction jobs was paid by BRI-DE and Quad. BRI-DE and Quad were required to pay employment taxes to the IRS on the amount of wages that they paid to their employees. In addition, these companies were required to report employment taxes on an Employer's Quarterly Federal Tax Return, also known as a Form 941.
At the direction of Allard, Form 941s were filed on behalf of BRI-DE reflecting $806,149 in employment taxes due and owed to the IRS for the last quarter of 2005 and the first two quarters of 2006. In addition, Form 941s were filed on behalf of Quad reflecting $1,333,590 in employment taxes due and owed to the IRS for the four quarters of 2005.
At the direction of Allard the taxes were not paid. Instead, the defendant used the funds from BRI-MA for the benefit of creditors of BRI-MA other than the IRS, and for the benefit of himself and his family. He diverted funds from BRI-MA to Eaglewood Realty for the purchase of luxury automobiles.
With respect to the bankruptcy fraud charge, on October 14, 2005, the defendant filed for personal bankruptcy. He received a discharge in bankruptcy in January 2006. In both his bankruptcy petitions, and during the creditor’s hearing, the defendant failed to disclose his ownership of property located at 91 Haven St., Warwick, Rhode Island.
Allard, who is on unsecured bond in the amount of $50,000, was ordered by the Court to surrender himself to begin serving his sentence on March 17, 2010. Allard will remain on supervised release for three years upon his release from prison.
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