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Payroll Service Owner Admits to Stealing Clients’ Tax Funds
Baltimore, Maryland – Kevin Carden, age 55, formerly of Bel Air, Maryland, pleaded guilty today to wire fraud and to filing a false tax return, arising from a scheme to steal money from his clients and the IRS.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Thomas Jankowski of the Internal Revenue Service – Criminal Investigation, Washington, D.C. Field Office; and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation.
“When customers realized that the money they entrusted to AccuPay was not being used as intended to pay their taxes, Kevin Carden misled them with false cover stories,” said U.S. Attorney Rod J. Rosenstein. “What really happened was that Kevin and Beverly Carden took money intended for the IRS and spent it themselves, causing millions of dollars in losses to their customers.”
According to his plea agreement, until its closure in March 2013, Kevin Carden and his wife, Beverly Carden operated AccuPay, Inc. which provided payroll and payroll tax services to small and medium businesses. Kevin Carden ran the company’s “tax department,” which was responsible for handling the employment tax portion of the business. AccuPay received funds from its clients that it held in trust to pay over to the IRS and the Comptroller of Maryland for AccuPay’s clients’ employment taxes.
During the course of the fraud scheme, which Kevin Carden admitted lasted from 2010 to March 2013, AccuPay withdrew from the clients’ funds the full amount of payroll taxes owed, but then paid the taxing authorities only a portion of the funds. While AccuPay falsely represented to its clients that it paid all of the taxes owed, in fact, Beverly Carden diverted some of those funds to a joint personal bank account that she and her husband maintained which the couple then used to pay personal expenses.
The Cardens used various methods to cover up their diversion of funds and to allay their clients’ concerns when they learned that the taxing authorities had apparently not been paid the full amounts they were supposed to receive. For example, in the instances in which AccuPay’s clients confronted employees at AccuPay about the underpayment of their taxes, Kevin Carden either told those clients that the underpayment would be addressed or (in some cases) avoided their inquiries.
The guilty plea was entered just before Carden’s trial was scheduled to begin. Kevin Carden is scheduled to be sentenced on May 10, 2024. Kevin Carden faces a maximum sentence of 20 years in prison for wire fraud and up to 3 years in prison for filing a false tax return. He also faces a fine of up to $250,000 for the wire fraud conviction and a fine of up to $100,000 for the false tax return conviction.
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Key Facts
- State: Maryland
- Category: Fraud & Financial Crimes|White Collar Crime
- Source: DOJ Press Release â†â€â€
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