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Justice News

Department of Justice
U.S. Attorney’s Office
Western District of Michigan

FOR IMMEDIATE RELEASE
Monday, February 5, 2018

Berrien County Resident Charged With Federal Tax Evasion

Lori Lynn Pawielski admits embezzling more than $1.9 million and failing to pay $511,433 in federal income tax

          GRAND RAPIDS, MICHIGAN — United States Attorney Andrew Birge announced today that Lori Lynn Pawielski, a resident of Buchanan, Michigan, has been charged with tax evasion. Pawielski has agreed to plead guilty to one count of attempting to evade or defeat tax and pay the Internal Revenue Service additional tax due and owing for tax years 2009 through 2015.

          In a Felony Information filed in federal court, the government alleged that, in March 2016, Pawielski willfully attempted to evade and defeat income tax due and owing to the United States for calendar year 2015 by preparing and signing a false and fraudulent Form 1040 tax return. The charge alleges that the Form 1040 tax return falsely claimed that her taxable income was $149,160 when in fact it was $330,166. The charge also alleges that the tax due and owing for calendar year 2015 was $84,516, not $28,941 as reported on the tax return.

          If convicted, Pawielski faces up to five years in federal prison and a fine of $250,000.

          In a written plea agreement filed with the Court, Pawielski admitted embezzling more than $1.9 million from her former employer between 2009 and 2016 by writing 271 checks to herself without her employer’s authorization. She further admitted that she concealed her embezzlement by altering the company’s accounting software to make it appear those checks were issued to suppliers. Pawielski admitted that she failed to report the additional income to the IRS on her 2009-2015 federal tax returns. She has agreed to pay restitution to the IRS, currently estimated at $511,433, and restitution to her former employer in the amount of $1,962,611.

          This matter was investigated by the Internal Revenue Service Criminal Investigation division and is being prosecuted by Assistant U.S. Attorney Christopher O’Connor.

          An arraignment and plea hearing is scheduled for February 15, 2018. The charge in a felony information is merely an accusation, and the defendant is presumed innocent until proven guilty in court.

END

Updated February 12, 2018