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Thursday, October 23, 2014

Former Campaign Treasurer Pleads Guilty to Charges, Admits Diverting Money from Campaign's Bank Account

Defendant Worked on Unsuccessful D.C. Council Candidate’s Campaign

Hakim J. Sutton, 33, of Washington, D.C., pleaded guilty today to evading income taxes and violating campaign finance laws while working as the treasurer and custodian of records for a District of Columbia political campaign.

The guilty plea, in the U.S. District Court for the District of Columbia, was announced by U.S. Attorney Ronald C. Machen Jr., Acting Deputy Assistant Attorney General Larry J. Wszalek for the Department of Justice’s Tax Division, Chief Cathy L. Lanier of the Metropolitan Police Department (MPD) and Special Agent in Charge Thomas J. Kelly of the Internal Revenue Service-Criminal Investigation (IRS-CI) Washington Field Office.

Sutton pleaded guilty to one count of income tax evasion, a federal offense, and one count of knowingly filing a false and misleading campaign finance report, a violation of District of Columbia law.  The Honorable Judge Richard J. Leon scheduled sentencing Feb. 4, 2015.  Under the applicable sentencing guidelines, the parties have agreed that Sutton faces a likely range of 10 to 16 months in prison and a fine of up to $30,000 for federal income tax evasion, and a likely range of six to 24 months in prison for knowingly filing a false or misleading campaign finance report.  The plea agreement also calls for Sutton to pay full restitution of $18,231 in taxes and interest to the IRS.

According to a statement of offense, signed by the defendant as well as the government, Sutton was the principal owner of the Sutton Group, which performed political consulting services in the District of Columbia and elsewhere.  In 2011 and 2012, Sutton served as the treasurer and custodian of records for the campaign of Michael A. Brown, a candidate seeking re-election to an at-large seat on the District of Columbia Council.  Brown ultimately lost in the November 2012 election.

Between July 2011 and May 2012, Sutton diverted approximately $115,250 from the campaign bank account to himself by depositing the funds drawn from the campaign bank account into his own personal bank accounts and converting funds drawn from the campaign bank account to cash.  All told, Sutton wrote 36 checks payable to himself.

According to the statement of offense, some, but not all, of the money that Sutton diverted was compensation for Sutton’s work on the campaign.  However, Sutton failed to file income tax returns for calendar years 2011 and 2012.  He owes a total of $17,180 in federal income taxes for those years along with an additional $1,051 in interest.

Sutton also omitted references to the checks that he had written to himself in a series of six reports he filed in 2011 and 2012 with the District of Columbia Office of Campaign Finance.

This case was investigated by the MPD and IRS-CI.  It was prosecuted by Assistant U.S. Attorney David A. Last and former Assistant U.S. Attorney Bryan Seeley of the U.S. Attorney’s Office for the District of Columbia and Trial Attorney Kenneth C. Vert of the Tax Division.  Assistance was provided by Assistant U.S. Attorney Anthony Saler of the Asset Forfeiture and Money Laundering Section, Legal Assistant Angela Lawrence, Paralegal Specialist Tasha Harris, former Paralegal Specialist Nicole Wattelet and Criminal Investigator John Marsh, all of the U.S. Attorney’s Office for the District of Columbia.

Press Release Number: 
Updated January 8, 2016