Pamela Smith, Tax Offense, Connecticut 2021

Pamela Smith, 72, formerly of Guilford, Connecticut, was sentenced to two years of probation and 100 hours of community service for aiding in the preparation of a false tax return.

According to court documents and statements made in court, Smith, the former Chief Financial Officer of Equinox Home Care, LLC (EHC), a home healthcare staffing agency based in Stratford, Connecticut, engaged in a scheme to hide funds from the true recipient, Theresa Foreman. Between 2009 and 2018, Smith and EHC’s payroll manager helped Foreman receive money from EHC in a manner that concealed the fact that Foreman was the true recipient of the funds.

Foreman directed Smith and the payroll manager to issue payments to ‘ghost employees’ who did not work for EHC, and those funds were actually for Foreman’s benefit. Smith became aware that the payroll checks were being issued to the ‘ghost employees’ and that EHC and its payroll manager were causing the false payroll checks to be issued. She also assisted Foreman by issuing or causing to be issued bonus checks from EHC to approximately 30 EHC employees, who later cashed the checks and provided the cash to Foreman.

Some EHC employees did not request a corrected W-2 and, as a result, overpaid taxes to the IRS. In addition, Foreman received funds through cashed mileage checks that were issued to two individuals who did not drive on behalf of EHC.

Smith failed to inform the tax return preparer about funds that Foreman received through these various mechanisms. More than $600,000 of such funds were not reported on Foreman’s 2014 tax return alone. Smith pleaded guilty to the offense on January 12, 2021.

Foreman pleaded guilty to one count of tax evasion and, on January 6, 2020, was sentenced to 12 months and one day of imprisonment and ordered to pay $641,941.46 in restitution.

The Internal Revenue Service – Criminal Investigation Division is investigating this matter, and the case is being prosecuted by Assistant U.S. Attorneys Jennifer R. Laraia and Peter S. Jongbloed.

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