Texas Business Owner Sentenced to Prison for Not Paying Approximately $18 Million in Employment Tax

[nitpicker]

https://www.justice.gov/opa/pr/texas-business-owner-sentenced-prison-not-paying-approximately-18-million-employment-taxes

Department of Justice
Office of Public Affairs

FOR IMMEDIATE RELEASE
Thursday, July 6, 2017

Texas Business Owner Sentenced to Prison for Not Paying Approximately $18 Million in Employment Taxes

Spent Funds on His Ranch, Travel to Las Vegas, Hawaii and France and other Personal Items

A Houston, Texas business owner was sentenced today to 36 months in prison for failing to pay over employment taxes, announced Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and Acting U.S. Attorney Abe Martinez for the Southern District of Texas.

According to documents filed with the court, Richard Floyd Tatum Jr., 57, owned Associated Marine & Industrial Staffing Inc. (AMI), an industrial staffing company that provided temporary labor to businesses in Texas and other states. Tatum employed approximately 1,000 people to include internal employees, who worked for AMI, and external employees, who AMI assigned to work on-site at client locations. Tatum was responsible for collecting, accounting for and paying over to the Internal Revenue Service (IRS) the payroll taxes withheld from AMI’s employees’ wages. Tatum exercised significant control over AMI’s finances, entered into contracts on behalf of AMI, signed checks, to include payroll, and decided which creditors to pay. Tatum also signed and filed AMI’s employment tax returns.

From March 2008 through December 2009, Tatum filed false and delinquent employment tax returns for AMI, which did not report AMI’s external employees. In May 2013, Tatum filed delinquent returns for the quarters ending in March 2010 through December 2012, reporting AMI’s external employees but making no payments of the taxes owed. Tatum withheld from his employees approximately $12 million in payroll taxes from March 2008 through December 2012, but did not pay over any of this money to the IRS. Tatum also failed to pay $6 million of AMI’s required share of social security and Medicare taxes during the same quarters. Instead, he used the money for his personal benefit, including making payments on his ranch and traveling to Las Vegas, Hawaii and France. Tatum admitted that he caused a tax loss of more than $18 million.

In addition to the term of imprisonment imposed, Tatum was order to serve three years of supervised release and to pay restitution to the IRS in the amount of $18,298,604. Tatum pleaded guilty to one count of failing to pay over employment taxes in March.
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[Ilsa]

1. Glad he's going to prison. nt