News and Press Releases

SUMNER MAN PLEADS GUILTY TO INCOME TAX EVASION -Admits Paid Too Little Tax on More than $2 Million Received from U.S. Postal Service

FOR IMMEDIATE RELEASE
September 8, 2006

GUY V. FLAKE, 51, of Sumner, Washington pleaded guilty September 7, 2006 in U.S. Magistrate Court in Seattle to Income Tax Evasion. According to the plea agreement, FLAKE is a contractor who installed and maintained mailboxes for the United States Postal Service. Over the years 1998-2000, FLAKE was paid $2,126,843 by the U.S. Postal Service. FLAKE underpaid his income taxes during that period by at least $142,000. The exact amount owed to the government will be determined at his sentencing hearing on December 1, 2006.

According to the plea agreement FLAKE failed to file any tax return in 1998, failing to report some $531,303.53 paid to him by the U.S. Postal Service. FLAKE did not file his income tax return for 1999 until March, 2001. In 1999, he was paid $1,034,733.18 by the Postal Service, but reported only $573,388 of the gross receipts, a discrepancy of more than $460,000. For the year 2000, FLAKE under reported his gross receipts by at least $43,000. At sentencing the government may prove that FLAKE failed to report more than $230,000 of gross receipts paid during that year.

FLAKE was indicted by a grand jury on May 5, 2006. Income Tax Evasion is punishable by up to five years in prison and a $250,000 fine plus the costs of prosecution.

The case is being investigated by the Internal Revenue Service Criminal Investigation (IRS-CI) and is being prosecuted by Assistant United States Attorney Janet Freeman.

For additional information please call Emily Langlie, Public Affairs Officer for the United States Attorney’s Office, at (205)553-4110.

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