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Warren County, Kentucky, construction company owner charged with income tax evasion

– Indictment alleges from 2004 to 2007 concealed $3,300,726 in income from the IRS
– From 2005 through 2008 failed to report $1,045,327 in income from the IRS
– Failed to disclose his ownership in Tri-State Construction and income received

April 25, 2012

LOUISVILLE, KY – A Warren County, Kentucky construction company owner appeared before U.S. Senior District Judge Thomas B. Russell this morning, facing charges of income tax evasion announced David J. Hale, United States Attorney for the Western District of Kentucky.

A grand jury meeting in Bowling Green, Kentucky on Wednesday, April 11, 2012, returned a twelve count indictment against Darrell Mathis, owner of Tri-State Construction. Mathis was charged with five counts of income tax evasion, four counts of filing a false tax return and three counts of aiding and assisting in the preparation of false income tax returns. The returns were filed with the Internal Revenue Service (IRS).

Specifically, the indictment alleges, beginning in June 2004 and continuing until the present, Mathis, age 47, of Alvaton, Kentucky, attempted to evade and defeat the payment of a large part of his federal income taxes for tax years 1999 through 2001. Additionally, Mathis filed false income tax returns for 2005 through 2008 by failing to report approximately $1,045,327.63 of net income he received from his construction company, Tri-State Construction. For tax years 2004 through 2007, Mathis allegedly falsely reported $3,300,726 of gross income earned by Tri-State Construction on the federal income tax returns of another individual (initials R.S.). Mathis allegedly prepared, signed and filed the tax returns of R.S. with the IRS, falsely reporting this income. According to the indictment, Mathis received the $3,300,726 of gross income that was falsely reported on the tax returns of R.S.

According to the indictment, Mathis submitted two offers in compromise to the IRS in June 2005 and January 2006, omitting vehicles, boats, and his ownership and control of Tri-State Construction and its bank accounts. In December 2007, Mathis allegedly purchased a piece of real estate at Cooper Dearing Road in the name of a nominee to conceal the purchase from the IRS. In January 2008, he sold this piece of real estate and purchased property located at 121 Timber Ridge Court, Alvaton, Kentucky, again in the name of a nominee. The indictment further alleges that in 2009 and 2010, Mathis caused the owner of Southside Auto Sales to file liens on his vehicles to conceal his equity in them from the IRS. Lastly, the indictment charges that in January 2007, Mathis purchased a Keystone camper, titling the camper in a nominee name to conceal his ownership.

The indictment states that beginning in January 2006, Mathis has made large cash withdrawals from Tri-State Construction bank accounts in an effort to conceal his income.

If convicted of the charges, Mathis faces no more than five years in prison and a fine of $250,000 on each of the income tax evasion counts and no more than three years in prison, a $250,000 fine on each of the false returns counts. Mathis was released on a $25,000 unsecured bond.

This case is being prosecuted by Assistant United States Attorney Bryan Calhoun and was investigated by the IRS, Division of Criminal Investigation.

* * *

The indictment of a person by a Grand Jury is an accusation
only and that person is presumed innocent until and unless
proven guilty.

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