SEATTLE MAN PLEADS GUILTY TO TAX FRAUD – FAILS TO REPORT $1.8 MILLION IN INCOME
DAVID MICHAELS NGUYEN, 32, of Seattle pleaded guilty in United States District Court in Seattle to Making and Subscribing a False Income Tax Return. NGUYEN, as an officer of Apex General Services, signed the U.S. Corporate Income Tax Return for 2002 stating the gross receipts for the company were just $46,823. In fact, Apex's actual gross receipts were $1,809,220. For tax year 2001 NGUYEN signed the return reporting just $13,038 in gross receipts when in fact gross receipts were $1,035,992. NGUYEN's partner in Apex, DAT THANH BUI, 31, of Seattle pleaded guilty to Structuring Financial Transactions to Evade Reporting Requirements on September 16, 2004.
Apex was a Washington corporation with approximately sixty employees. The company provided low-skilled, temporary employees for various businesses in Seattle including Triple B Corporation, Cascade Designs and George Heiser Auto Body. According to the plea agreement, NGUYEN provided the company's tax preparer only with information related to income that was deposited into and expenses that were paid out of the company bank account. NGUYEN knew that most of the checks it received from its customers were not deposited but were simply cashed at various check cashing establishments. Most employees were paid in cash, and their wages were not reported nor were the required taxes reported or withheld. For example, in the Fourth Quarter of 2003 Apex reported $8,684 paid in wages when in fact the company had paid $334,565 in wages.
According to DAT THAN BUI's plea agreement, between June 1, 2000 and February 3, 2004 BUI cashed about 872 checks at local check cashing outlets such as Dollarwise, Money Mart, Moneytree, and A-1 Check Cashing. The total dollar amount on the checks exceeded $4.5 million. On approximately 135 different occasions BUI knowingly structured about $3 million worth of checks he received from his clients. He instructed the clients to issue multiple checks to Apex in amounts under $10,000 to evade requirements that transactions over that amount be reported to federal authorities.
The maximum penalty for structuring financial transactions is up to five years in prison, up to three years of supervised release and a $250,000 fine. Making and subscribing a false income tax return is punishable by up to three years in prison, one year of supervised release and a $100,000 fine. As part of NGUYEN's plea agreement, he will cooperate with the Internal Revenue Service to resolve all civil tax liabilities including penalties and/or interest owed by Apex.
Sentencing for BUI is set for February 25, 2005 at 1:30. NGUYEN will be sentenced April 1, 2005 at 1:30. Both men will be sentenced by U.S. District Court Judge Thomas S. Zilly.
The case was investigated by the IRS Criminal Investigations Division. Assistant United States Attorney Susan Loitz prosecuted the case. For additional information please contact Emily Langlie, Public Affairs Officer for the United States Attorney's Office, Western District of Washington at (206)553-4110.