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Four Family Members Plead Guilty to Defrauding IRS of Over $5 Million
BOSTON, Massachusetts – Four family members who operated a temporary employment agency pleaded guilty yesterday to charges relating to a scheme to hide $25 million in employees’ wages from the U.S. Internal Revenue Service.
Margaret Mathes, 67, Boseba Prum, 47, Sam Pich, 63, and Thaworn Promket, 52, all of Lowell, pleaded guilty to conspiracy to defraud the Internal Revenue Service, mail fraud, and to violating laws against structuring monetary transactions to avoid reporting requirements.
The defendants ran a temporary employment agency providing both short-term and long-term unskilled labor to companies in and around Lowell, including those in the packaging and food services industries. Between 2004 and 2009, the agency operated under the name International Temp Agency (INT) and JP Company.
Between 2004 and 2009, the defendants reported to the IRS that their temporary employees made about $2.2 million in wages, when the real figure was nearly $30 million. The defendants also defrauded the agency’s workers compensation insurer, Granite State Insurance Co., by hiding the true number of temporary workers the defendants employed, thus avoiding about $880,000 in insurance premiums.
Each of the statutes provide a maximum penalty of between five and 20 years in prison. The statutes also provide for substantial fines and up to three years of supervised release. Note that actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.
The investigation was undertaken jointly by the IRS, the FBI, and the Massachusetts Insurance Fraud Bureau. The case is being prosecuted by Andrew E. Lelling of Ortiz’s Economic Crimes Unit.
On November 24, 2014, the defendants are scheduled to be sentenced by U.S. Senior District Judge Mark L. Wolf.
Key Facts
- State: Massachusetts
- Category: Financial Crimes
- Source: DOJ Press Release â†â€â€
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