John Kungu, Tax Evasion, Delaware 2024

Business Owner Sentenced to 18 Months in Prison for Tax Evasion Scheme

A Townsend, Delaware man has been sentenced to 18 months in federal prison for a multi-year tax evasion scheme. John Kungu, 62, the owner of Advanced Nursing Care, engaged in a calculated scheme to avoid paying nearly $1.2 million in taxes.

Between 2018 and 2021, Kungu submitted multiple false sworn statements to the Internal Revenue Service (IRS) claiming that he could not afford to pay his tax liabilities, despite having millions of dollars in undisclosed bank accounts. On one occasion, Kungu offered to settle his tax debt for $35,000, claiming he would need to take out a loan, while simultaneously holding over $5.1 million in hidden accounts.

Additionally, from 2018 through 2020, Kungu filed false personal and corporate tax returns by intentionally categorizing hundreds of thousands of dollars in personal benefits and payments to himself as business expenses, thereby improperly reducing his tax burden to the government. Kungu intentionally withheld financial records from his bookkeeper and tax preparer to conceal his evasion.

“John Kungu built a highly successful business, but instead of paying his fair share, he chose to line his own pockets at the expense of every law-abiding taxpayer,” said U.S. Attorney Benjamin L. Wallace. “When caught, he doubled down on his fraud, lying under oath to the IRS to hide millions of dollars in wealth. Yesterday’s sentence demonstrates that those who view tax evasion as a mere cost of doing business will face serious consequences, including time in federal prison.”

Kungu was sentenced to 18 months in prison, followed by 3 years of supervised release. In addition to his prison sentence, he was ordered to pay a $75,000 fine and $1,186,573.62 in restitution to the IRS. The case was investigated by IRS Criminal Investigation and prosecuted by Assistant U.S. Attorneys Alexander P. Ibrahim and Claudia L. Pare.

The sentencing occurred on April 7, 2024, in the District Court for the District of Delaware. A copy of the press release is located on the website of the U.S. Attorney’s Office for the District of Delaware. Related court documents and information are located on the website of the District Court for the District of Delaware or on PACER by searching for Case No. 1:24-cr-00056-CFC.

Kungu’s actions were a clear example of tax evasion, which can have serious consequences for individuals and businesses. The case highlights the importance of paying taxes and adhering to tax laws.

Source: https://www.justice.gov/usao-de/pr/delaware-business-owner-sentenced-18-months-federal-prison-multi-year-tax-evasion-scheme