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July 18, 11

NEWS / Internet Communications Firm Owners Plead Guilty to Employment Tax Fraud and Failure to Pay Tax


WASHINGTON – Frank G. Bivings and Isabelle Blanco of Washington, D.C., husband and wife and co-owners of The Bivings Group Inc., pleaded guilty today to charges stemming from the failure to pay more than $2 million in employment taxes to the Internal Revenue Service (IRS). The guilty plea took place in U.S. District Court for the District of Columbia.



Bivings pleaded guilty to one count of failure to pay over employment taxes. Blanco pleaded guilty to one count of failure to pay a tax. Sentencing for both defendants is scheduled for Oct. 20, 2011.



The Bivings Group was a full-service Internet communications business. In pleading guilty, Bivings and Blanco both admitted that between Jan. 1, 2002, and June 30, 2008, The Bivings Group failed to pay over to the IRS a total of $2,420,927 in employment taxes, which includes withholding and Federal Insurance Contributions Act (FICA) taxes. Of this amount, $1,813,488 represented the money that was withheld from employees for taxes but that was not paid over to the IRS. The department said that, instead of paying these payroll taxes to the IRS, the defendants used the funds to pay themselves substantial salaries and withdrew additional corporate funds for other expenses.



Bivings faces a maximum of five years in prison, and Blanco faces a maximum of one year in prison. The parties agreed, however, that the calculation under the advisory U.S. Sentencing Guidelines for each defendant is 30 to 37 months in prison. Both defendants also agreed to pay $2,420,927 in restitution.



In announcing today’s guilty plea, Principal Deputy Assistant Attorney General John A. DiCicco, U.S. Attorney Ronald C. Machen Jr., of the District of Columbia and Acting Special Agent in Charge Jeannine A. Hammett commended the investigatory work of IRS-Criminal Investigation Special Agent Michael Helgesen. They also praised the work of Assistant U.S. Attorney Susan B. Menzer and Tax Division Trial Attorney Tino Lisella, who investigated and prosecuted the case.

http://www.justice.gov/opa/pr/2011/July/11-tax-931.html

Tags: criminal investigation,
 




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