Former Mayor and Councilman for Islamorada Village Sentenced for Tax Evasion

The former Mayor and Councilman for Islamorada Village was sentenced today, by United States District Court Judge Jose E. Martinez, after previously pleading guilty to conspiring to commit tax evasion, in violation of Title 18, United States Code, Section 371.

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.

Michael Alan Reckwerdt, 47, of Islamorada, Florida, was sentenced to 12 months and 1 day for conspiring to defraud the IRS in the collection of employment taxes. Following his release from incarceration, Reckwerdt will be on supervised release for three years.  Reckwerdt was also ordered to pay a $10,000 fine and $160,031.71 in restitution.  Reckwerdt previously paid an additional $276,951.46 to the IRS in order to satisfy restitution, interest and penalties.

According to court documents and information presented in court, Reckwerdt, who owns and operates several businesses in Islamorada and Key West, namely, Flamingo Air of the Florida Keys, Inc., Rent-A-Boat, Inc., Robbie’s Charter Enterprises, Inc., Robbie’s Marine Enterprises, Inc., and Robbie’s of Key West, LLC, conspired to pay a portion of his employees’ wages in cash from January 2006 through December 2010, and consequently, underpay employment taxes due and owed to the IRS.  The cash payments were uncovered after the IRS executed three search warrants on Reckwerdt’s home and two of his businesses on November 3, 2011, and seized hundreds of business and financial records.  A subsequent review of those records revealed that between 2006 and 2010, Reckwerdt’s businesses had systematically paid employees in cash and therefore underreported employees’ wages and underpaid employment taxes.  Additionally, interviews of current and/or former employees of Reckwerdt revealed that once an employee’s salary composition was determined, the companies’ books and tax records were falsified to hide and conceal the cash payments to employees. Between 2006 and 2010, Reckwerdt underreported approximately $1,045,841.24 in cash wages, resulting in $160,013.71 of employment tax due and owed to the U.S. government.

Mr. Ferrer commended the investigative efforts of the IRS-CI.  This case was prosecuted by Assistant U.S. Attorney Kimberly A. Selmore.

Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on http://pacer.flsd.uscourts.gov