Circleville Businessman Sentenced for Tax Fraud
COLUMBUS, Ohio – John Anderson Rankin, 55, of Circleville, Ohio, was sentenced in U.S. District Court to 60 months in prison for tax crimes that included a total tax loss of approximately $8.1 million. Rankin was also ordered to pay restitution in the amount of $7.1 million.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, and Ryan L. Korner, Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, Cincinnati Field Office announced the sentence handed down today by Chief U.S. District Judge Edmund A. Sargus, Jr.
Rankin was convicted of 17 tax-related charges following a two-week trial in September 2017.
A federal grand jury indicted Rankin in July 2015 with seven counts of failing to account for and pay over employment taxes to the Internal Revenue Service (IRS), six counts of willfully filing false federal individual income tax returns with the IRS, three counts of willfully filing false federal corporate income tax returns with the IRS and one count of obstructing and impeding the due administration of the IRS.
According to court documents and testimony, Rankin operated a number of Circleville-based businesses, including Connectivity Systems, Inc., a mainframe software company that provides internet protocol development and servicing. Rankin Enterprises, LLC was a shell corporation that included the Circleville Movie House, Screening Room, J.R. Hooks Café and Tootles Pumpkin Inn. Rankin also owned the Tuscan Table, an Italian restaurant in downtown Circleville.
Between June 2008 and April 2011 Rankin, conducting business as Rankin Enterprises and Tuscan Table, failed to account for and pay over to the IRS all federal income and FICA taxes.
Rankin also filed false Amended U.S. Individual Income Tax Returns with the IRS for the 2005, 2006, 2007, 2008 and 2009 income tax years. He claimed a corrected adjusted gross income amount of a negative $1.7 million, when in actuality his corrected adjusted gross income was more than $8.9 million.
In 2010, Rankin filed a false individual income tax return that reported an adjusted gross income of nearly $27,000, when his actual gross income was nearly $1.6 million.
In addition, Rankin filed false U.S. Corporation Income Tax Returns with the IRS for Connectivity Systems Incorporated for the 2008, 2009 and 2010 income tax years. These false forms claimed a fraudulent accelerated Research & Development Credit in the amount of $1.7 million against the corporate taxes due and owing of Connectivity Systems Incorporated.
Lastly, between January 2005 and July 2015 Rankin made false and misleading statements to agents of the IRS and concealed information from agents of the IRS.
“Rankin effectively robbed both the United States and his employees, and not only did he perpetrate this decade-long tax-fraud scheme, but he also introduced fake records at trial,” U.S. Attorney Glassman said. “The jury rightfully convicted him for his illegal conduct, and his sentence today reflects his continued disregard for the law.”
“The sentencing of Rankin is an important victory for America's taxpayers who play by the rules and have no tolerance for those who make up their own rules. This investigation serves to remind us that there is no such thing as free money and there are no awards or incentives for creativity when it comes to crime,” said Ryan L. Korner, Special Agent in Charge, IRS Criminal Investigation, Cincinnati Field Office.
U.S. Attorney Glassman commended the investigation of this case by IRS-Criminal Investigation, as well as Assistant United States Attorneys Daniel A. Brown and Noah R. Litton, who represented the United States in this case.