November 11, 08

NEWS / Herndon Man Pleads Guilty to $3M Embezzlement and Tax Evasion

( Herndon , VA ) - Jeffrey S. Koger, age 39, of Herndon, Virginia, pled guilty today to wire fraud and income tax evasion. Dana J. Boente, United States Attorney for the Eastern District of Virginia; Assistant Attorney General Nathan J. Hochman of the United States Department of Justice’s Tax Division; C. André Martin, Special Agent-in-Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C. Field Office; and Jeffrey Irvine, Special Agent-in-Charge of the United States Secret Service’s Washington Field Office made the announcement after the plea was accepted by United States District Judge Leonie M. Brinkema.

Sentencing has been set for February 6, 2009. Koger faces a maximum penalty of 25 years imprisonment, $500,000 in fines, full restitution and three years of supervised release.

According to a statement of facts filed with his plea agreement, Koger was the Chief Financial Officer for Koger Management Group (KMG), which was the property management company for approximately 400 homeowners’ associations. Between 2003 and 2006, KMG had a bank account that received dues from homeowners that KMG then distributed into the associations’ individual accounts. On approximately 140 occasions, Koger diverted funds intended for the associations’ accounts into his personal accounts and that of an account for an unrelated business, Tri-Fitness in Annandale, Virginia, for which he was also the chief financial officer. During the period of time that Koger was embezzling the money, he invested at least $733,000 into a restaurant, Jordan’s 8, in Washington, D.C., spent almost $500,000 on remodeling his home and the Tri-Fitness facility, and made down payments of $60,000 on a house in New Mexico and $40,000 on a Corvette.

According to the statement of facts, Koger never filed personal income tax returns for the years 2003-2006 and evaded a total of $775,273 in federal income taxes.

This case was investigated by the Internal Revenue Service Criminal Investigation and the Secret Service, with assistance from the Fairfax City Police Department, the Alexandria City Police Department, and the Federal Bureau of Investigation. Assistant United States Attorney Jack Hanly and Trial Attorney Caryn Mark of the Department of Justice’s Tax Division are prosecuting the case on behalf of the United States.
http://washingtondc.fbi.gov/dojpressrel/pressrel08/wfo111008.htm


Tags: criminal investigation,