San Francisco Public Official And Contractors Charged With Crimes Related To Public Corruption And Money Laundering Scheme
SAN FRANCISCO – Christine Hill pleaded guilty today to tax evasion announced United States Attorney Brian J. Stretch and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Michael T. Batdorf. The plea agreement was accepted by the Hon. Richard Seeborg, U.S. District Judge, following the filing of an information in which Hill was charged with tax evasion.
Hill, 54, of Vallejo, pleaded guilty to knowingly and willingly filing a fraudulent 2010 U.S. Individual Income Tax Return, Form 1040. According to the plea agreement, Hill is the Director of Operations at John Compagno, MD, Inc., with offices in Hercules, Calif. She is responsible for the payroll including collecting time sheets and processing paychecks. Hill acknowledged she knew that bonus payments are subject to federal income tax withholding and that she processed numerous bonus checks for herself and other employees in which federal taxes were withheld and bonus payments were reported on IRS Forms W-2. Nevertheless, Hill also admitted she received additional year-end bonus payments from at least 2003 through 2011. These bonus payment checks were paid to Hill directly and not processed through the payroll account. Because the extra bonus payments were not processed through the payroll account, they were not reported on IRS Forms W-2 and therefore not reported to the IRS.
In addition, Hill’s spouse received payments from John Compagno, MD, Inc. for repairs, maintenance, and construction work he did for the company for the period of 2004 through 2011. John Compagno, MD, Inc. did not issue Forms 1099 for those services. For the period of 2003 through 2011, Hill omitted income from additional bonuses and payments to her spouse in the amount of $122,391. This resulted in additional tax due of $35,566.
On March 1, 2017, Hill was charged with tax evasion, in violation of 26 U.S.C. § 7201. Pursuant to the plea agreement, Hill pleaded guilty to the charge in the one-count information. Judge Seeborg scheduled a hearing for sentencing on June 20, 2017. The maximum sentence for a violation of 26 U.S.C. § 7201 is five years in prison and a fine of $250,000. However, any sentence following conviction would be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Thomas Moore is prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.