Former D.C.-Area Attorney Charged with Tax Crimes, Making False Statements to Federal Authorities

WASHINGTON — An indictment was unsealed today charging attorney Richard Graham Foote O’Donoghue with evading taxes on approximately $1 million of income, as well as filing false tax returns and making false statements to federal authorities. O’Donoghue previously lived in the District of Columbia, but currently lives in the United Kingdom. He was arrested on entering the United States today, based on the criminal charges.

The unsealing of the indictment was announced by U.S. Attorney Edward R. Martin Jr. and Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division.

According to the indictment, from 2012 through 2015, O’Donoghue made substantial income first as an independent contractor for several non-U.S. businesses, including a defense contractor based out of Dubai, United Arab Emirates, and then as CEO of that contractor. While he was CEO, O’Donoghue allegedly also received significant bonuses and benefits including a car and driver and a rented luxury villa for his family.

The indictment alleges that O’Donoghue did not timely file tax returns for tax years 2012 through 2014. In 2016, however, O’Donoghue hired a return preparer to prepare tax returns for 2012 through tax year 2015. O’Donoghue allegedly provided false information to his return preparer about his employment and income. For example, O’Donoghue allegedly told the return preparer that he was the general manager of the company, not the CEO, and concealed his bonuses and the expenses the company paid on his behalf. These alleged lies allegedly caused the return preparer to prepare and file false tax returns for those years that underreported his income by approximately $1 million. Because O’Donoghue had previously made estimated payments, his false returns allegedly requested refunds from the IRS of more than $247,000 — much of which the IRS paid out.

The indictment further alleges that in February 2023, O’Donoghue made false statements about his income and other matters to law enforcement agents and Department of Justice prosecutors.

If convicted, O’Donoghue faces a maximum penalty of five years in prison for each tax evasion count, a maximum penalty of three years in prison for each count of subscribing to a false tax return, and a maximum penalty of five years in prison for the false statements count. O’Donoghue also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

This matter is being investigated by IRS Criminal Investigation and the Special Inspector General for Afghanistan Reconstruction, with assistance from His Majesty’s Revenue & Customs of the United Kingdom. Assistance was also provided by the Joint Chiefs of Global Tax Enforcement (J5), which brings together the taxing authorities of Australia, Canada, the Netherlands, the United Kingdom, and the United States.

The case is being prosecuted by Assistant U.S. Attorney Joshua Gold and Assistant Chief Sarah Ranney and Trial Attorney Ezra Spiro of the Tax Division.

An indictment is merely an allegation. All defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.