Detroit Man Indicted For Evasion Of Payment Of Income Tax Due, Filing False Income Tax Returns And Bankruptcy Fraud
A Detroit man was arraigned today on charges of tax evasion and bankruptcy fraud, U.S. Attorney Barbara L. McQuade announced today.
McQuade was joined in the announcement by Jarod J. Koopman, Special Agent in Charge of the Internal Revenue Service Criminal Investigation Division.
Steven Pittman was charged with one count of federal income tax evasion, two counts of filing false tax returns and seven counts of bankruptcy fraud.
According to the indictment, from 2003 through 2006, Pittman worked for Direct Internet Consulting as a contract salesman providing internet cable services to the Detroit Public School district (DPS), the Detroit Medical Center and others. In mid-2007, Pittman filed Forms 1040, U.S. Individual Income Tax returns for the years 2003 and 2006, reporting tax due and owing of approximately $70,000. Pittman did not include payment of this tax liability with the returns.
When the Internal Revenue Service initiated collection efforts in early 2008, Pittman began to take steps to evade the payment of his outstanding federal tax liability. In April 2008, Pittman filed documents with the State of Michigan, forming an entity named Metrotech Solution Services, LLC (Metrotech), with the signature of “Rodman Edmons” as the Organizer and Resident Agent. Around the same time, Pittman also opened a bank account in the name of Metrotech, and over the course of that year deposited more than $150,000 into the account. Most of the deposits were derived from payments made by the DPS for work performed by Metrotech to install security equipment. In September 2009, Pittman, signed a contract under an alias name with DPS to install and maintain security equipment. Pittman provided services for a number of months to DPS under the security equipment contract and was paid more than $700,000.
In September 2011, Pittman filed a voluntary petition in bankruptcy with the U.S. Bankruptcy Court for the Eastern Judicial District of Michigan. Pittman signed the petition and the Statement of Financial Affairs under penalty of perjury declaring that all of his statements were true and correct. However, Pittman knew that the statements were false. Pittman stated that he owed only $532.44 to the IRS; he failed to disclose the use of an alias; he failed to properly report income he earned in 2009 and 2010 and he failed to declare his interest in the bank accounts and businesses he controlled.
In October 2011, Pittman filed Forms 1040, Individual Income Tax returns for the years 2009 and 2010. Each of these returns were false; Pittman listed himself as an employee of Metrotech, failed to disclose that he was the owner of the company, and failed to report any of the income he earned from the DPS security equipment contract.
“Pittman's blatant abuse of the bankruptcy and tax system was motivated by greed. Investigating and seeking convictions for these violations will hopefully reinforce to the public that no one is above the law”, said Special Agent in Charge Jarod J. Koopman.
An indictment is merely an accusation and is not evidence of guilt. The defendant is presumed innocent unless and until proven guilty in a court of law.The investigation of this case was conducted by Special Agents of the Internal Revenue Service Criminal Investigation and prosecuted by Assistant U.S. Attorney Ross I. MacKenzie and Assistant U.S. Attorney Richard A. Robel.