Northern Michigan Cinemas Owner Sentenced For Tax Evasion And Ordered To Pay Nearly $1,000,000 In Restitution
GRAND RAPIDS, MICHIGAN – Elaine Dawson, 69, of Bellaire, Michigan was sentenced to 1 year in prison followed by 1 year of supervised release, announced U.S. Attorney Patrick Miles, Jr. U.S. District Court Judge Janet T. Neff also ordered Dawson to pay restitution of $988,366.00 to the U.S. Internal Revenue Service. The sentence was imposed as the result of an October 10, 2012 guilty plea to a felony information charging her with tax evasion. U.S. Attorney Miles was joined in the announcement by Special Agent in Charge Erick Martinez of the IRS Criminal Investigation.
According to court records, Dawson willfully evaded nearly a million dollars in corporate and personal income taxes between 2004 and 2010. Dawson owned five cinemas in Bellaire, Petoskey, Gaylord, Mackinaw City, and Cheboygan, Michigan. She routinely under-reported the number of patrons who bought movie tickets, and under-reported her receipts from sales of concessions, gift certificates and other items. Dawson skimmed the cash from the unreported sales for personal use, and disclosed only the remaining sales as income when preparing her tax returns.
In addition to paying all the back taxes she had evaded, Dawson is required to pay substantial fraud penalties to the IRS. Dawson liquidated substantial personal assets in order to be able to pay the restitution and penalties.
“Defrauding the tax system does a great deal of harm to the American public,” said Martinez. “Especially in challenging times, everyone’s full contribution counts,” said Miles, “hiding one’s wealth while allowing other hard-working, honest citizens to carry the burden isn’t fair, and won’t be tolerated.”
The case was prosecuted by Assistant U.S. Attorney Nils R. Kessler.