David Richison, Tax Evasion, Maryland 2023

Baltimore Maryland – David Richison, age 64, of Frederick, Maryland, who owned and operated a payroll processing business, pleaded guilty today to federal charges of wire fraud and aiding in the filing of a false tax return, in connection with a fraud scheme in which he took funds from his clients’ tax escrow account and used them to pay his own personal expenses.

The guilty plea was announced by Robert K. Hur, United States Attorney for the District of Maryland, and Kelly R. Jackson, Special Agent in Charge of the Internal Revenue Service - Criminal Investigation, Washington, D.C. Field Office.

According to his plea agreement, Richison owned and operated a Frederick-based payroll processing business, Period Financial, doing business as Period Payroll. Period Payroll provided payroll processing and payroll tax payment services to businesses in Maryland and Virginia, using special software specifically designed by Richison.

Between approximately February 2013 and December 2014, Richison used approximately $598,365 of client escrow funds to make payments to the IRS to cover the penalties and interest his clients had accrued in order to conceal the fraud and continue to deceive his clients into thinking that Period Payroll was solvent.

By the end of 2014, there were insufficient funds in the client escrow account to cover the mounting debts and Richison closed Period Payroll. By that time, the difference between the amount taken from clients and reported to have been paid to the IRS per the tax returns filed on behalf of clients, and the actual payments made as required by those returns totaled at least $1,622,481.56.

As part of his plea agreement, Richison will be required to pay restitution in the full amount of the victims’ losses, which totals at least $1,622,481.56. A sentencing hearing has been scheduled for [insert date].

Richison is currently facing charges of wire fraud and aiding in the filing of a false tax return, and is expected to face severe penalties for his actions.

Source: https://www.justice.gov/usao-md/pr/owner-frederick-payroll-processing-business-pleads-guilty-federal-fraud-and-tax-charges