Massachusetts Businessman Indicted for Tax Fraud
The owner of a heating, ventilation and air conditioning (HVAC) installation and repair company from West Bridgewater, Massachusetts, was arraigned today in U.S. District Court in Boston on an indictment filed on July 23 charging him with one count of tax evasion, five counts of filing false federal income tax returns and four counts of failing to file tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.
According to the allegations in the indictment, Keith A. Eaton failed to file tax returns for tax years 1998 through 2003. In 2004, the Internal Revenue Service (IRS) assessed him with approximately $280,000 in taxes, interest and penalties, which he failed to pay. Eaton also filed delinquent false tax returns for tax years 2000 through 2008, on which he failed to report the income that he had earned working for another HVAC company located in Brockton, Massachusetts. Eaton allegedly attached false IRS Forms 1099, Miscellaneous Income, to some of the false tax returns that he submitted. The Forms 1099 purportedly reflected the compensation he had received from companies for whom he had performed work, but Eaton altered the forms to falsely show that he had not received compensation.
The indictment further alleges that in 2008, Eaton began operating his own HVAC company, Eaton Mechanical LLC. In order to obstruct the IRS from collecting taxes that Eaton owed, he caused the HVAC company to be registered in the name of a nominee and caused the nominee to be listed as the signatory on the business bank account. To further conceal his financial transactions from the IRS, Eaton used cash to pay his personal expenses.
If convicted, Eaton faces a statutory maximum sentence of five years in prison for tax evasion, a statutory maximum sentence of three years in prison for each count of filing a false return and a statutory maximum sentence of one year in prison for failing to file a return. He also faces substantial monetary penalties, including fines and restitution to the IRS. His arraignment is scheduled for Aug. 28 at 10:00 a.m. in Boston.
Acting Assistant Attorney General Ciraolo commended the special agents of the IRS–Criminal Investigation, who investigated the case, and Trial Attorneys Kenneth C. Vert and Brittney N. Campbell of the Tax Division, who are prosecuting the case. Ciraolo also thanked the U.S. Attorney’s Office of the District of Massachusetts for their substantial assistance.
An indictment merely alleges that a crime has been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.