Harrisburg Businessman Pleads Guilty To $216,000 Withholding Tax Fraud
The United States Attorney’s Office for the Middle District of Pennsylvania, announced that a 30-year old Harrisburg man pleaded guilty today before Senior U.S. District Court Judge William C. Caldwell to tax evasion in the amount of $216,000 between October 2006 and May 2011.
According to United States Attorney Peter Smith, Howard Ginting was the sole owner of Ginting Enterprises, Inc., a Pennsylvania corporation in Harrisburg. Ginting Enterprises supplied day laborers to various businesses in central and northeastern Pennsylvania. As the owner and operator, Ginting was required to withhold from the wages of the GEI employees the Federal Insurance Contributions Act (FICA) taxes on a quarterly basis. From October, 2006 through February, 2008, Ginting Enterprises paid wages totaling approximately $851.553, but Ginting falsely reported to the IRS that he had only paid wages in the amount of approximately $68,549. He underpaid the Social Security tax and Medicare taxes owed by GEI by approximately $119,799.
In February, 2008, Ginting shut down Ginting Enterpirses and operated his same labor supply business under the name Trojan Services, Inc. Between February, 2008 and May, 2011, Trojan paid wages of approximately $638,477, but Ginting failed to report to the IRS all wages paid to his employees, underpaying Social Security tax and Medicare taxes owed by Trojan by approximately $97,047.
This resulted in underreporting the employee and employer share of the Social Security and Medicare taxes in the total amount of approximately $216,846.
Ginting was charged by a grand jury in Harrisburg in an indictment in January 2014, following an investigation by the Internal Revenue Service Criminal Investigations.
Ginting faces a potential maximum sentence of 5 years imprisonment, a $250,000 fine and up to 3 years supervised release as well as restitution and tax penalties and interest.
The case is being prosecuted by Assistant U.S. Attorney Gordon Zubrod.