Justice News

Department of Justice
Tax Division

Wednesday, November 17, 2010

Michigan Software Salesman Pleads Guilty To Conspiracy To Defraud The Government

WASHINGTON - Theodore R. Kramer pleaded guilty to one count of conspiracy to defraud the United States before U.S. District Court judge John Corbett O'Meara in Detroit, the Department of Justice and Internal Revenue Service (IRS) announced today. The court set sentencing for March 15, 2011.

According to court documents, Kramer was a self-employed computer software salesman. Kramer sold a computer software program called Journal Sales Remover (JSR) to business, including two Detroit-area strip clubs. JSR's design was to remove a portion of a business's sales from the business's computerized books. JSR thus created the appearance that a business received less income than it actually did.

In 2001, the owner of two Detroit-area strip clubs requested that Kramer load the JSR program onto his clubs' computer systems so that the club owner could report less income to the IRS. From about 2001 to about 2004, Kramer periodically visited the clubs to run the JSR program to remove a substantial amount of the clubs' sales from their computers. The club owner then provided the reduced sales figures to his accountant. With Kramer's assistance, the club owner understated his clubs' gross receipts by more than $500,000.

Kramer faces a maximum sentence of five years in prison.

John A. DiCicco, Acting Assistant Attorney General for the Department of Justice, Tax Division, and Barbara L. McQuade, U.S. Attorney for the Eastern District of Michigan, commended the IRS Special Agents who investigated the case and Tax Division Trial Attorneys Kenneth C. Vert and Tiwana L. Wright, who are prosecuting the case.

Press Release Number: 
Updated April 6, 2015