Former Federal Contractors Plead Guilty to Federal Contract Fraud Conspiracy
George Patton and Henry Patton both pleaded guilty yesterday to conspiring to defraud the United States, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina. George Patton also pleaded guilty to evading payment of his individual income taxes.
According to documents filed with the court, George Patton owned businesses that were registered to do business with the federal government, but he was eventually debarred from conducting such business. During this time, George Patton, his wife, Lindsey Patton, and his brother, Henry Patton then conspired to form new contracting businesses for which Lindsey Patton and Henry Patton acted as nominee owners, but which George Patton controlled. Under this arrangement, the conspirators obtained federal contracts totaling over $10 million. In order to conceal the income that he earned from the businesses, George Patton instructed his co-conspirators first to deposit funds from the businesses into bank accounts in their names and then transfer the funds to him. George Patton further concealed his income by directing his co-conspirators to deposit the funds in amounts less than $10,000 to evade currency-reporting requirements.
George Patton and Lindsey Patton filed income tax returns for the 2006 through 2008 and 2013 tax years, which reported approximately $61,000 in taxes, which they have evaded paying. The total tax loss associated with their conduct, including penalties and interest, is over $107,000.
Lindsey Patton pleaded guilty on November 9, 2018 to conspiring to defraud the United States and to evading payment of her individual income taxes.
Sentencing for George Patton and Henry Patton is scheduled for March 18, 2019. Sentencing for Lindsey Patton is scheduled for February 27, 2019. George Patton and Lindsey Patton each face a maximum sentence of eight years in prison, as well as a period of supervised release, restitution, and monetary penalties. Henry Patton faces a maximum of five years in prison, a period of supervised release, restitution, and monetary penalties.
Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS-Criminal Investigation, the Department of the Interior, and the Department of Defense Office of Inspector General, who investigated the case, and United States Assistant Attorney Anand Ramaswamy and Trial Attorney Alexander Effendi of the Tax Division, who are prosecuting this case.