Florida Businessman Sentenced to Prison for Conspiring to Commit Tax and Bank Fraud

Monday, July 17, 2017

Concealed Approximately $2.5 Million in Secret Belize Accounts

A Florida businessman was sentenced today to 57 months in prison in U.S. District Court for the Middle District of Florida for conspiring to commit tax and bank fraud, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

According to documents filed with the court, Casey Padula, 48, of Port Charlotte, was the sole shareholder of Demandblox Inc., a marketing and information technology business. Padula conspired with others to move funds for his benefit from Demandblox to offshore accounts in Belize and disguised these transfers as business expenses in Demandblox’s corporate records. Padula created two offshore companies in Belize: Intellectual Property Partners Inc. (IPPI) and Latin American Labor Outsourcing Inc. (LALO). He opened and controlled bank accounts in the names of these entities at Heritage International Bank & Trust Limited (Heritage Bank), a financial institution located in Belize. From 2012 through 2013, Padula caused periodic payments to be sent from Demandblox to his accounts at Heritage Bank and deposited approximately $2,490,688. Padula used the funds to pay for personal expenses and purchase significant personal assets. However, he falsely recorded these payments in Demandblox’s corporate books as intellectual property rights or royalty fees and deducted them as business expenses on Demandblox’s 2012 and 2013 corporate tax returns. As a result of these false deductions, Padula caused a tax loss of more than $728,000.

Padula also conspired with investment advisors Joshua VanDyk and Eric St-Cyr at Clover Asset Management (CAM), a Cayman Islands investment firm, to open and fund an investment account that he would control, but that would not be in his name. Heritage Bank had an account at CAM in its name and its clients could get a subaccount through Heritage Bank that would not be in the client’s name but rather would be a numbered account. Padula transferred $1,000,080 from the IPPI bank account at Heritage Bank in Belize to CAM to fund a numbered account that concealed his financial interest in it. Padula failed to disclose this account to the U.S. Department of Treasury and the Internal Revenue Service (IRS) despite being required to do so under the law.

In addition to the tax fraud, Padula also conspired with others to commit bank fraud. Padula had a mortgage on his Port Charlotte, Florida home of approximately $1.5 million with Bank of America (BoA). In 2012, he sent a letter to the bank stating that he could no longer repay his loan. At the same time, Padula provided Robert Robinson III, 43, who acted as a nominee buyer, with more than $625,000 from his IPPI bank account in Belize to fund a short sale of Padula’s home. Padula and Robinson signed a contract, which falsely represented that the property was sold through an “arms-length transaction,” and agreed that Padula would not be permitted to remain in the property after the sale. Padula in fact never moved from his home and less than two months after the closing, Robinson conveyed it back to Padula by transferring ownership to one of Padula’s Belizean entities for $1. Robinson was also sentenced today to five years of probation for signing a false Form HUD-1 in connection with his role in the scheme.

“Casey Padula used secret numbered bank accounts, foreign shell companies and phony deductions to hide millions and evade U.S. taxes,” said Acting Deputy Assistant Attorney General Goldberg. “His 57 month sentence today makes clear that there is no place safe in the world for tax cheats to hide their money and feel secure that the Department of Justice and the IRS will not uncover their scheme and hold them fully accountable.”

“As Mr. Padula has learned, using shell companies and offshore accounts is not tax planning; it’s tax fraud,” said Chief Don Fort of IRS Criminal Investigation (CI). “The use of sophisticated international financial transactions does not prevent IRS CI from following the trail of money back to the person breaking the law. In conjunction with our law enforcement partners, we will continue our ongoing efforts to pursue individuals who use these offshore schemes to circumvent the law.”

In addition to the term of prison imposed by U.S. District Court Judge Sherri Polster Chappell, Padula was ordered to serve three years of supervised release and to pay a fine of $100,000 and to pay restitution of $728,609 to the IRS and to BoA in the amount of $739,459.90. He was remanded into custody.

Acting Deputy Assistant Attorney General Goldberg thanked special agents of IRS CI, who conducted the investigation, and Assistant Chiefs Todd Ellinwood and Caryn Finley of the Tax Division, who prosecuted this case. Acting Deputy Assistant Attorney General Goldberg also thanked the U.S. Attorney’s Office of the Middle District of Florida for its assistance.

Additional information about the Tax Division’s enforcement efforts can be found on the division’s website.

Surgical Practice Office Manager’s Boyfriend Sentenced to Nearly 6 Years in Prison for Embezzlement Conspiracy

Friday, July 14, 2017

BIRMINGHAM – A federal judge this week sentenced a Mississippi man to nearly six years in prison for conspiring with his girlfriend to steal more than $1 million from the Birmingham surgical practice where she worked, announced Acting U.S. Attorney Robert O. Posey and FBI Acting Special Agent in Charge David W. Archey.

U.S. District Court Judge Madeline Hughes Haikala sentenced ANTHONY T. MICHAEL, 43, of Jackson, Miss., to five years and 10 months in prison for conspiracy, bank fraud and aggravated identity theft. Michael pleaded guilty to the charges in March. The judge ordered him to pay $1.2 million in restitution and to forfeit the same amount to the government as proceeds of illegal activity.

Michael conspired with Anntwine Moss, 51, of Bessemer, to steal from Thoracic and Cardiovascular Surgery of Alabama between 2006 and 2013. Moss was office manager for the practice during that time and she and Michael were romantically involved.

U.S. District Court Judge Karon O. Bowdre sentenced Moss in May to three years and five months in prison on five counts of wire fraud and four counts of tax evasion in the case. The judge ordered Moss to pay $987,375 in restitution to the practice and to forfeit the same amount to the government.

According to court documents, Moss stole from the surgical practice by using her authority as office manager to write unauthorized checks to herself and to Michael, make unauthorized direct deposits into her account, and use the company’s credit cards for unauthorized personal purchases for herself and Michael. Moss had authority over several key functions at the surgical practice including payroll, accounting, bookkeeping and managing the office’s budget. She falsified her personal tax returns for several years by failing to report to the IRS the illicit income she stole from the practice.

The FBI and IRS investigated the case, which Assistant U.S. Attorney Xavier O. Carter Sr. prosecuted.