U.S. Department
of Justice
Former Owner of Boston Forensic Accounting Firm Pleads Guilty to Tax Evasion
BOSTON – The former owner of a Boston forensic accounting firm pleaded guilty today in federal court in Boston to understating his income by hundreds of thousands of dollars on his personal income tax returns.
James Carey, 50, pleaded guilty to two counts of making material misstatements on his 2009 and 2010 personal income tax returns. U.S. District Court Judge Allison D. Burroughs scheduled sentencing for Nov. 29, 2017. In April 2017, Carey was indicted on two counts of filing false federal tax returns.
Carey, a certified public accountant, owned Carey & Company, a forensic accounting firm in Boston. Carey & Company administered bank accounts on behalf of insurance companies into which the insurance companies and their clients could make deposits, and from which payments could be made on behalf of and to the insurance companies. In November 2009, a customer of one of the insurance companies sent Carey & Company a payment of $594,217 intended for the insurance company, but during the months that followed, Carey transferred almost all of that money out of the account and used it for his own purposes. The money Carey misappropriated from the insurance company was taxable income, which Carey failed to report on his personal income tax return. In addition, in 2010, Carey reported less than one-third of his business’s actual income on his personal income tax return.
The charging statute provides for a sentence of no greater than three years in prison, one year of supervised release, a fine of $250,000, and restitution of unpaid taxes. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
Acting United States Attorney William D. Weinreb and Joel P. Garland, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. Assistant U.S. Attorneys Stephen Heymann and Sara Bloom of Weinreb’s Economic Crimes Unit are prosecuting the case.