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In a significant case underscoring the importance of tax compliance, Dariusz Pietron, owner of two construction companies, has pleaded guilty to defrauding the IRS and Travelers Insurance Company. The plea was entered on May 15, 2024, and the sentencing is scheduled for August 28, 2024, by U.S. District Judge Indira Talwani.
The Case Against Pietron
Between 2012 and October 2018, Pietron owned and operated TJM Construction, Inc. (TJM) and Point Construction, Inc. (Point). During this period, Pietron engaged in a scheme to avoid paying employment taxes by failing to report his employees’ wages to the IRS and not withholding or paying the required taxes. Furthermore, Pietron deceived Travelers Insurance Company by underreporting wages to reduce workers’ compensation insurance premiums.
To execute this scheme, Pietron recruited two employees to establish three shell companies, making it appear as if TJM and Point’s employees were subcontractors. This maneuver allowed Pietron to evade over $1.1 million in employment taxes and defraud Travelers Insurance of approximately $244,000.
Legal Consequences
Pietron has pleaded guilty to three counts of failure to collect and pay over employment taxes and one count of mail fraud. The potential penalties for these charges are severe:
- Failure to Pay Over Taxes: Up to 5 years in prison, 3 years of supervised release, and a fine of $250,000 or twice the gross gain or loss.
- Mail Fraud: Up to 20 years in prison, at least 3 years of supervised release, and a fine of $250,000 or twice the gross gain or loss.
Pietron has also agreed to pay restitution to the IRS and Travelers Insurance and to forfeit $244,000.
IRS Criminal Investigation
This case was investigated by the IRS Criminal Investigation (CI) unit, which is responsible for conducting financial crime investigations, including tax fraud. CI special agents are the only federal law enforcement agents with jurisdiction over violations of the Internal Revenue Code and boast a federal conviction rate of over 90%.
Acting United States Attorney Joshua S. Levy, Harry Chavis, Jr., Special Agent in Charge of the IRS CI Boston Field Office, and Katherine Mulligan, Chief of Investigations for the Insurance Fraud Bureau of Massachusetts, announced the charges. The case is being prosecuted by Assistant United States Attorney Victor A. Wild of the Securities, Financial & Cyber Fraud Unit.
Conclusion
This case serves as a stark reminder to business owners about the serious consequences of failing to comply with tax laws. The IRS takes tax fraud seriously and has the resources and authority to investigate and prosecute those who attempt to evade their tax obligations. Business owners must ensure they are fully compliant with all tax regulations to avoid severe legal repercussions. If you are facing tax issues, call IRSProb.com today!
