April 17, 2003

PRESS RELEASE

MOTHER AND SON PLEAD GUILTY TO TAX EVASION

Boston, MA... A West Dennis, Massachusetts woman and a Tiverton, Rhode Island man were convicted yesterday in federal court of tax evasion.

United States Attorney Michael J. Sullivan and Joseph A. Galasso, Special Agent in Charge of the U.S. Internal Revenue Service, Criminal Investigation, announced that JOAN E. BISHOP, age 71, of 149 Cove Rd., West Dennis, Massachusetts, and her son JOHN J. PALIE, JR., age 47, of 115 Riverscape Drive, Tiverton, Rhode Island, pleaded guilty before U.S. District Judge Joseph L. Tauro to one count each of tax evasion.

At yesterday's plea hearing, the prosecutor told the Court that had the case proceeded to trial the Government's evidence would have proven that BISHOP was the primary owner of A&P Alloys, Inc., a West Bridgewater business which was a wholesale producer of stainless steel and other metals. In the early 1990's, BISHOP opened five bank accounts in the name of A&P Alloys, Inc. at different banks and deposited into those accounts customer checks which were payable to the business. During the years 1995 to 1998, BISHOP deposited over $970,000 in checks into those accounts. However, BISHOP failed to disclose those accounts or deposits to the company's accountant or tax preparer. BISHOP withdrew over $1 million from the accounts for her own and her husband's personal use. BISHOP filed a false and fraudulent federal tax return for the year 1996 which understated her income by over $400,000 and thereby attempted to evade paying $189,148 in taxes for that year. According to the prosecutor, through this scheme BISHOP also avoided paying $195,993 in 1995 and $12,126 in 1997.

Also at the plea hearing, the prosecutor told the Court BISHOP's son, PALIE, took over day to day control of A&P Alloys in 1997. PALIE opened a bank account in October, 1997 in the company's name and deposited over $200,000 in customer checks payable to the business into the account. PALIE then transferred the funds to his personal bank account and used the proceeds for his own personal use, including as a portion of the down payment on his residence. PALIE also failed to disclose the bank account or the diversion of the checks to the company's accountant and tax preparer. PALIE filed a false and fraudulent federal income tax return for the year 1997 which understated his income by over $200,000 and thereby attempted to evade paying $75,524 in taxes for that year.

Judge Tauro scheduled sentencing for both defendants for July 9, 2003. BISHOP and PALIE each face up to 5 years' imprisonment, to be followed by 3 years of supervised release, and a $250,000 fine.

The case was investigated by the U.S. Internal Revenue Service, Criminal Investigation. It is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard in Sullivan's Economic Crimes Unit.

Press Contact: Samantha Martin, (617) 748-3139