Crystal Jones, Wire Fraud & Employment Tax Evasion, Maryland 2021

A federal indictment has been filed charging Crystal Jones, a/k/a Crystal Powell-Jones, age 53, of Laurel, Maryland, for the federal charges of wire fraud and failure to pay to the IRS employment taxes withheld from employees’ wages. Jones is expected to have an initial appearance and arraignment in U.S. District Court in Baltimore before U.S. District Judge George L.

The indictment was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner and Acting Special Agent in Charge Darrell Waldon of the Internal Revenue Service - Criminal Investigation (IRS-CI), Washington, D.C. Field Office.

According to the indictment, Jones was the owner and managing partner of JAG Professional Resources, a temporary employment agency doing business in Howard County, Maryland and elsewhere from 2012 through August 2017. As JAG’s managing partner, Jones exercised control over all aspects of JAG’s business, including its finances. A relative of Jones was a silent minority partner in JAG.

The indictment alleges that from at least February 2013 through October 2016, Jones obtained factoring services from Victim Lender 1 for JAG. Factoring is a means by which cash intensive businesses, like JAG, could obtain cash quickly and reliably by leveraging accounts receivable. JAG was a cash intensive business because JAG had to pay its temporary employees weekly or biweekly, but typically did not receive payment from JAG’s clients until at least 30 days after services had been rendered, which meant that JAG could be short of the cash flow needed to pay its employees each week, but its business model was theoretically profitable if all outstanding invoices had been paid.

The indictment alleges that from March 2016 to about May 2016, Jones caused JAG to sell Victim Lender 1 fraudulent invoices totaling more than $350,000 for services that JAG had purportedly provided to a City in Ohio. To execute the scheme, Jones allegedly created false paystubs purportedly issued by JAG and fraudulent invoices that purported to represent services that JAG had provided, so Jones could obtain loans for her own benefit and the benefits of others.

In addition, the indictment alleges that from January 2014 to October 2016 Jones withheld payroll taxes from the wages paid to JAG employees, but neglected to pay the taxes withheld over to the Internal Revenue Service, resulting in a tax loss to the United States of at least $523,244.38. If convicted, Jones faces a maximum sentence of 20 years in federal prison for wire fraud; and a maximum of five in federal prison for failure to pay over employment taxes.

Source: https://www.justice.gov/usao-md/pr/former-owner-temporary-employment-agency-facing-federal-charges-allegedly-defrauding