Michael Lynch, Wire Fraud, Tax Evasion, Rhode Island 2018

A high-ranking executive at Dr. Pepper has been brought to justice after a lengthy investigation into his involvement in a vast scheme of wire fraud and tax evasion.

Michael Lynch, 53, of Newport, Rhode Island, was sentenced to 33 months in federal prison for submitting over $1.7 million in fraudulent invoices to Dr. Pepper through a promotions and marketing company he formed in his wife's name, Seacoast Unlimited Marketing and Promotions, LLC.

The scheme, which began in April 2003 and continued until November 29, 2017, saw Lynch submit more than 200 invoices to Dr. Pepper for services such as promotional signs and banners, delivery of sample products to retail stores, and offering discount prices to retail stores. None of these services were actually provided.

The income generated from these fake invoices was not declared on the joint federal tax filings Lynch filed with his wife, resulting in a tax loss of $386,320.

Lynch pleaded guilty to wire fraud and filing a false tax return on February 27, 2018. In addition to his prison sentence, he was also ordered to serve 2 years of supervised release, pay full restitution to Dr. Pepper, and pay the taxes owed to the Internal Revenue Service.

The U.S. Sentencing Guidelines recommended a sentence of 33-41 months, and the government had recommended 33 months incarceration. Lynch will begin serving his sentence immediately.

The case was investigated by the FBI and the Internal Revenue Service Criminal Investigation, and was prosecuted by Assistant U.S. Attorney Lee H. Vilker.

Source: https://www.justice.gov/usao-ri/pr/dr-pepper-executive-sentenced-prison-fraud-tax-evasion