Bethpage Woman Pleads Guilty To Filing False Tax Return
Failed to Report Over $600,000 in Embezzled Funds
B Traci Lynne Howes, 40, of Bethpage, Tennessee, pleaded guilty today to filing a false tax return which failed to report funds she embezzled from her employer, announced David Rivera, U.S. Attorney for the Middle District of Tennessee. Howes faces up to three years in prison and a fine of up to $250,000.
At the plea hearing, Howes admitted that while she was employed as the office manager at Drywall Systems, Inc., in Gallatin, Tenn., from January 2008 through July 2011, she embezzled approximately $605,796 from her employer, including wiring approximately $477,622 to her personal and business bank accounts and making unauthorized charges on the company’s credit cards. In addition, during the last quarter of 2010 and the first two quarters of 2011, Howes failed to file quarterly federal tax returns and did not pay to the IRS the taxes that had been withheld from employees’ paychecks.
For tax years 2008-2011, Howes failed to report the embezzled income on her personal tax returns, which caused a tax loss of approximately $139,525, not including penalties and interest. Additionally, during the last quarter of 2010 and the first and second quarters of 2011, Howes withheld employee trust fund taxes of approximately $117,592 from employee paychecks, but failed to pay that amount to the IRS. She also failed to pay the employer’s portion of payroll taxes in the amount of $88,631.
In the plea agreement, Howes agreed to the entry of a restitution order of at least $605,769 to Drywall Systems and $139,525 to the IRS.
A sentencing hearing is scheduled for September 5, 2014, before United States District Court Judge Kevin H. Sharp. This investigation was conducted by the IRS- Criminal Investigation. Assistant U.S. Attorney Kathryn W. Booth represents the government.
Stop Medicare Fraud
The U.S. Department of Health and Human Services (HHS) and U.S. Department of Justice (DOJ) are working together to help eliminate fraud and investigate fraudulent Medicare and Medicaid operators who are cheating the system.