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Tax Evasion Lands Businessman Behind Bars
A Wilmington, North Carolina, man has been sentenced to serve 12 months and one day in prison for tax evasion, the Justice Department and Internal Revenue Service (IRS) announced today.
Jeffrey Wayne Scott, 48, pleaded guilty on May 14 to one count of willfully attempting to evade his personal income tax for tax year 2007. Scott, the owner of Greenville Loop Seafood (GLS), a seafood distribution company located in Wilmington, has been operating the business since 1995.
According to court documents and court proceedings, Scott and his wife filed joint individual income tax returns for tax years 2006 through 2010. Scott reported that his taxable income for these five years ranged between $23,934 and $92,999, and paid only $91,800 in federal income taxes for this time period. However, during these five years, the Scotts spent far in excess of this reported taxable income on personal expenditures.
The IRS calculated that Scott failed to report in excess of $1,270,000 in taxable income for these five years and owed at least $412,844 in additional federal income taxes. Between 2006 and 2010, the Scotts paid for nearly all of their living expenses with checks from GLS, including utilities, insurance premiums, landscaping, home improvements, school fees, and a country club membership. They also purchased five vehicles totaling more than $200,000, a $100,000 boat, and a $2.1 million waterfront home.
When first contacted by IRS-Criminal Investigation agents in June 2011, Scott falsely stated that he was letting friends stay in his second home rent free. Furthermore, despite being aware that he was under criminal investigation, in November 2012, Scott filed a false 2011 GLS corporate income tax return claiming work on his personal residence, including painting and repair work by a plumber, and health bills related to his family dog as business expenses.
This case was investigated by special agents of IRS-Criminal Investigation. Assistant U.S. Attorney Susan B. Menzer for the Eastern District of North Carolina and Trial Attorney Todd A. Ellinwood of the Justice Department’s Tax Division are prosecuting the case.
Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.
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RELATED: Massachusetts Businessman Sentenced to Prison for Tax Evasion
Key Facts
- State: North Carolina
- Category: Fraud & Financial Crimes|White Collar Crime
- Source: DOJ Press Release ↗
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