Chesapeake Businessman Pleads Guilty to $1.2 Million Tax Fraud
NEWPORT NEWS, Va. – A Chesapeake man and business owner pleaded guilty today to defrauding the Internal Revenue Service (IRS) out of more than $1.2 million in taxes.
According to court documents, from 2013 through 2017 Shane August, 36, owned and operated a home-healthcare business in Chesapeake. August defrauded the IRS by, among other things, hiding personal bank accounts, using undisclosed accounts to conduct business, maintaining a cash lifestyle to avoid the IRS, making false statements about his ability to pay, lying to IRS agents, and diverting large sums of money to pay for personal expenses.
August withheld employment taxes from approximately 60 of his employees and failed to consistently pay more than $900,000 of those withholdings to the IRS. Each year, August provided fraudulent employment tax forms to his employees, who filed their own taxes and mistakenly believed that the amounts withheld from their wages had been paid to the Social Security program.
Additionally, between 2014 and 2017, August reported personal income to the IRS of more than $900,000 but failed to pay taxes on this income and now owes more than $288,000 in personal income tax for those years. Instead of paying his taxes, August used large sums of money to pay for personal expenses like a building contract on a home and a luxury vehicle lease.
August is scheduled to be sentenced on March 24, 2022. He faces a maximum penalty of five years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Darrell Waldon, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation (IRS-CI) Washington, D.C., Field Office, made the announcement after U.S. Magistrate Judge Robert J. Krask accepted the plea.
Assistant U.S. Attorney D. Mack Coleman is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:21-cr-62.