January 21, 2004

PRESS RELEASE

MOTHER AND SON SENTENCED FOR TAX EVASION

Boston, MA... A West Dennis, Massachusetts woman and a Tiverton, Rhode Island man were sentenced late yesterday in federal court for 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 in New England, 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, were sentenced by U.S. District Judge Joseph L. Tauro. BISHOP was sentenced to two years of probation, the first six months of which are to be served in home confinement with electronic monitoring. She was also ordered to pay a $4,000 fine. BISHOP had previously paid restitution to the IRS. The Court imposed BISHOP's sentence over the objection of the Government, downwardly departing from a Sentencing Guideline range of 15 to 21 months' imprisonment to the term of probation. PALIE was sentenced to two years of probation and ordered to pay a $3,000 fine. PALIE had also previously paid restitution to the IRS. The Court also imposed PALIE's sentence over the objections of the Government, downwardly departing from a minimum Sentencing Guideline range of 5 months' imprisonment and 5 months of home confinement to the imposed term of straight probation. BISHOP and PALIE pleaded guilty to tax evasion on April 16, 2003.

At the earlier 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. in West Bridgewater, 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 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 evaded 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 that earlier plea hearing, the prosecutor told the Court that 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 evaded paying $75,524 in taxes for that year.

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

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