Monday, November 20, 2017

Former Massachusetts Police Sergeant Sentenced to Prison for Embezzling Funds from Disabled Veterans

Department of Justice

Nov. 14, 2017 - A former Whitman, Massachusetts, police sergeant was sentenced to 48 months in prison today for preparing false income tax returns for clients of his tax preparation business, obstructing the internal revenue laws, and misappropriating funds from the accounts of disabled veterans while he was a fiduciary appointed by the U.S. Department of Veterans Affairs (VA), announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Department of Justice’s Tax Division and Acting U.S. Attorney William D. Weinreb for the District of Massachusetts.

According to documents filed with the Court, from 2007 to 2012, Glenn P. Pearson, 61, was appointed a VA fiduciary for eight disabled veterans of the U.S. armed forces. A veteran, who has been awarded VA benefits but is unable to manage his or her funds due to injury, disease, mental incompetence or infirmities of advanced age, can have a fiduciary appointed by the VA to receive funds on the veteran’s behalf and to manage those funds for the benefit of the veteran. Pearson used his position as a fiduciary to embezzle more than $250,000 in VA-issued benefit money from the accounts of several veterans.

Moreover, beginning in 2012, Pearson operated FTS Tax Services, a tax preparation business through which he prepared false tax returns for clients for a fee. From 2012 through 2015, Pearson prepared numerous tax returns that included false credits and fictitious deductions in an effort to obtain bigger refunds for his clients than they were entitled to receive. When Pearson’s clients were audited by the Internal Revenue Service (IRS), Pearson took steps to obstruct the IRS—including making false statements to the IRS and preparing false documents for his clients to submit to the IRS during the audits. Pearson also falsely underreported his own income on his personal federal income tax returns. Pearson admitted to causing a total tax loss of more than $1.5 million.

In addition to the term of prison imposed, Chief United States District Judge Patti B. Saris ordered Pearson to serve three years of supervised release and to pay restitution to the VA in the amount of $252,992 and restitution to the IRS in the amount of $826,865. Pearson pleaded guilty in May to wire fraud, misappropriation by a federal fiduciary, preparation of fraudulent tax returns and obstructing the internal revenue laws.

Acting Deputy Assistant Attorney General Goldberg and Acting U.S. Attorney Weinreb thanked special agents of IRS Criminal Investigation, FBI and VA–OIG, who conducted the investigation, and Assistant U.S. Attorney Vassili Thomadakis and Assistant Chief Karen Kelly of the Tax Division, who prosecuted the case.

Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.
source: DOJ press release                                                                                                                  

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