Running Out of Gas

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There is one primary thing that fuels fraud – greed. The former head of operations for a small Aleppo, Pennsylvania oil-and-gas company had plenty of greed to throw on the proverbial fire – enough to keep it burning for about four years while he stole hundreds of thousands of dollars in a tax fraud scheme that he carried off at the expense of his employer.

The former executive from Waynesburg, Pennsylvania was responsible for managing the company’s finances. In that capacity, he had signatory authority for the corporate bank account. (In other words, he had the ability to write lots of checks and cook the books. And, that’s exactly what he did.)

Today’s fraudster used his position of power to issue checks to himself. Over four years, he made personal purchases and fudged the books to make the checks look like payment for business costs. Some of the things he spent the ill-gotten money on include tuition for his daughter’s community college, his mortgage, credit card bills and an engagement ring for his son. (Now there’s a prospective father-in-law that went the extra mile. I’m guessing the ring got returned.)

 The former executive had a simple job to do – manage the books and pay the taxes. You could say that he definitely mis-managed the books and neglected to pay the taxes. He didn’t report the extra illegal income he collected on his personal income tax returns, causing the Internal Revenue Service to lose $456,000. (For example, he reported that he earned $113,000 during one tax year, when it was actually $356,000. Apparently, there were other discrepancies for other years as well.)

The former Pennsylvania executive’s tax fraud scheme finally ran out of gas when he admitted in court that he stole nearly a half million dollars from his employer, spending it on himself and his family. When questioned by the judge he didn’t have anything to say other than to admit his guilt. (I guess it was hard to refute the evidence.) When sentenced, the 56-year-old fraudster from Waynesburg is looking at 24 to 30 months in federal prison.

Today’s “Fraud of the Day” is based on an article entitled, Ex-Mountain Energy exec admits he stole from employer, doctored books,” published by Pittsburgh Post-Gazette on May 24, 2018.

The former head of operations for a small oil-and-gas company in Greene County became a felon Thursday when he admitted that he stole hundreds of thousands of dollars from his employer over a four-year span and used it for personal expenses for himself and his family.

Kevin Conklin, 56, of Waynesburg, pleaded guilty to wire fraud and tax evasion before U.S. District Judge David Cercone.

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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.