Upstate New York Couple Indicted in Tax Fraud Scheme
A federal grand jury yesterday returned a four count indictment in the Western District of New York charging two business owners with conspiracy to defraud the United States and filing a false tax return, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney William J. Hochul Jr for the Western District of New York.
According to the indictment, Lizhong “Tony” Shen and Xiaojie “Lucy” Shun, jointly operated BTL International Company Ltd., a tour and travel service company located in Niagara Falls, New York, between April 2004 and November 2009. The defendants were married at the time but, in 2009, they separated and Shen stopped working for BTL International. In January 2011, Shun ceased operation of BTL International and began operating another tour and travel service company, Niagara Falls Universal Inc.
For the tax years 2008 and 2009, Shen and Shun failed to properly report income generated by BTL International to the IRS on both corporate and personal tax returns. Both defendants also signed their 2009 personal tax return knowing the return included incorrect information. Shen and Shun reported income in the amount of $22,880 but it is alleged they knowingly received a significantly higher income.
In addition, Shun is charged with corruptly endeavoring to obstruct the due administration of the internal revenue laws. The indictment charges that, from April 2010 through April 2013, Shun provided inaccurate information to the accounting firm preparing the 2011 tax return for Niagara Falls Universal, the 2010 and 2011 personal tax returns for the couple and the 2012 tax return for herself.
The defendants face a maximum prison term of five years on the charge of conspiracy to defraud the United States and three years for each charge of filing a false return. Shun faces an additional three year term in prison for the charge of corruptly endeavoring to obstruct the due administration of the internal revenue laws. Both defendants also face a term of supervised release and monetary penalties.
An indictment merely alleges that crimes have been committed. Defendants are presumed innocent until proven guilty beyond a reasonable doubt.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Hochul commended special agents of the IRS- Criminal Investigation Division, under the direction of Special Agent in Charge Shantelle P. Kitchen, who are investigating the case, and Assistant U.S. Attorney Trini E. Ross and Thomas F. Koelbl of the Tax Division, who are prosecuting the case.