Point Richmond Resident Convicted Of Tax Evasion
Defendant Used Debit Cards, Cashier’s Checks, and Postal Money Orders to Conceal Assets From IRS
OAKLAND - A federal jury in Oakland returned a guilty verdict against Richard Thomas Grant yesterday afternoon on three counts of tax evasion, announced United States Attorney Brian J. Stretch and Internal Revenue Service, Criminal Investigation, Special Agent in Charge Michael T. Batdorf. The trial and conviction follows a three count superseding indictment on December 4, 2014, of tax evasion, in violation of 26 U.S.C. § 7201.
According to evidence presented at trial, Grant, 64, of Point Richmond, Calif., was a partner in Grant Engineering & Manufacturing, an engineering company in Richmond. Grant Engineering used a bookkeeper for monthly and annual bookkeeping who had access to Grant Engineering’s invoices, company checkbook, and monthly bank statements. From at least 2005 to 2009, the bookkeeper provided the company’s records to a CPA to prepare Grant Engineering’s annual partnership returns. From 2005 through 2009, Grant Engineering’s partnership income was $509,339, $566,741, $486,062, $598,977, and $604,706, respectively. Although the defendant’s share was half of these amounts during each of these years, the IRS nevertheless has no record of receiving Grant’s personal tax returns from 2005 through at least 2009. The evidence demonstrated Grant paid no federal income tax on his income from Grant Engineering during the years charged.
During 2005 and 2006, Grant took steps to conceal the income he received through Grant Engineering. For example, in 2005 Grant significantly curbed the use of his two checking accounts and began moving his partnership distributions from Grant Engineering to a warehouse bank known as MyICIS in Berryville, Ariz. Warehouse banks can be used to conceal ownership of funds in part by commingling such funds with those of other individuals. In addition, between April 2005 and October 2006, Grant wrote hundreds of checks drawn on the MYICIS account and funded multiple prepaid debit cards. Grant used the checks and debit cards to pay his mortgage and other personal expenses.
Eventually, the federal government shut down MYICIS. Grant, however, took additional steps to prevent the IRS from discovering the income he received from Grant Engineering. Specifically, Grant used another bank to convert his partnership distributions to cashier’s checks and cash, all the while avoiding depositing the vast majority of the funds into any one bank account. He also used cash to purchase dozens of U.S. Postal Money Orders and then used the money orders to pay bills and expenses, including utilities, taxes, and expenses for his classic aircraft.
Grant, was convicted on all three counts of tax evasion in the superseding indictment.
Assistant U.S. Attorney Colin Sampson, and Department of Justice Tax Division Trial Attorney Matthew Kluge are prosecuting the case. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.