A Little Adds Up

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Some people can’t resist temptation. For the owners of a Lithonia, Ga., a trucking company, their fatal temptation was the very receipts their successful business received. The Atlanta Journal Constitution reports that between 2005 and 2008, these fraudsters skimmed more than $1.5 million off of receipts earned by their trucking company. (As you can imagine, this proved to be a very problematic temptation.) On October 8, they were both sentenced to 18 months in prison, and to repay the IRS $144,455.

They managed to hide their theft from the Internal Revenue Service (IRS) for years because they structured their fraud, which is to say that they made sure to skim less than $10,000 from any receipt, ensuring that the IRS would not be automatically notified about the deposits they made in their private bank accounts. (Ironically, they didn’t opt for a structured settlement, instead fighting the fraud accusations in court.) The fraudsters were able to skim so much money over the course of three years because they had an exclusive contract with the DeKalb County Government for south precinct car tows. (But surely, when the DeKalb County Government gave this couple the exclusive contract, they were expecting a towing company that would help enforce the law instead of breaking it.)

Since the couple has been under investigation, they’ve had to park their towing company. Now that they’ve been sentenced, they’ll be spending a lot of time thinking about how committing fraud with their towing company landed them in jail. (Whether they choose to show up on their own, or whether they’re going to need to be towed to prison, has yet to be seen.)

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Lithonia towing company owners guilty of fraud,” written by Dionne Kinch and published by the Atlanta Journal-Constitution on October 8, 2015.

Owners of a local towing company have each been sentenced to one year, six months in federal prison following a jury’s guilty verdict in February 2015, on tax fraud charges stemming from the defendants skimming money from their business.

According to U.S. Attorney John Horn, the charges and other information presented in court: Kenneth and Kimberly Horner owned Topcat Towing and Recovery Inc., a towing business in Lithonia. Between 2005 and 2008, Topcat Towing had an exclusive contract with DeKalb County, for all county car tows needed from the south precinct of the county.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.