BUSINESS OWNER SENTENCED FOR TAX FRAUD

Kevin J. O'Connor, United States Attorney for the District of Connecticut, announced today that FELIX KOTOVNIKOV, age 54, of West Hartford, Connecticut and the president of Action Windows, was sentenced to serve 6 months in home confinement and five years of probation for filing a false tax return. Senior United States District Judge Ellen Bree Burns in New Haven also ordered him to pay a fine of $20,000.

U.S. Attorney O'Connor noted that on February 5, 2003, KOTOVNIKOV waived indictment and pleaded guilty to the charge. According to information disclosed at that plea proceeding, for tax years 1995 through 1997, KOTOVNIKOV filed tax returns that were false in three respects. First, during that time period, KOTOVNIKOV diverted $87,703.00 in income earned by Action Windows, Inc. from the corporate bank account which his accountant relied upon to prepare his tax returns. Instead, KOTOVNIKOV deposited these funds directly into his personal bank account. Second,

KOTOVNIKOV overstated his eligible deductions by claiming $61,695 in personal expenses as corporate deductions for Action Windows. Third, in his 1997 tax return, KOTOVNIKOV omitted $8,054 in gross receipts earned by his spouse's antique business. As a result of the foregoing, the total tax loss equaled $53,050.44.

Mr. O'Connor noted that, in accordance with the terms of the plea agreement, KOTOVNIKOV paid more than $207,000 in overdue taxes, penalties and interest.

The case was investigated by the Internal Revenue Service, Criminal Investigations Division. The case was prosecuted by Assistant United States Attorney Nancy V. Gifford.

CONTACT:

U.S. ATTORNEY'S OFFICE
Delcie Thibault
Public Information Office
(203)821-3722 Office
(203)627-1082 Cell