November 18, 09

NEWS / Rhode Island Couple Sentenced to Prison for Tax Evasion

Defendants Participated in Scheme to Hide Income of Machine Shop

WASHINGTON - Husband and wife, Albert Martin and Lorraine Martin of Woonsocket, R.I., were sentenced to prison today for committing tax evasion and conspiring to defraud the United States, the Justice Department and Internal Revenue Service (IRS) announced. Chief Judge Mary M. Lisi of the District of Rhode Island sentenced Albert Martin to 51 months in prison and three years of supervised release. The judge sentenced Lorraine Martin to one year and one day in prison and three years of supervised release. In addition to the prison terms, Judge Lisi ordered Albert and Lorraine Martin to pay restitution to the U.S. Treasury in the amount of $463,988.

In March 2009, a federal jury in Providence convicted the Martins and co-defendant Bruce Lapierre of conspiracy to defraud the United States and two counts each of tax evasion. According to the indictment and evidence introduced during the trial, Lapierre and Albert Martin owned and operated a Woonsocket-based machine shop from which they earned substantial income. From 1997 to 2004, the defendants engaged in an elaborate scheme to conceal from the IRS income that they earned through Classic Machine, and thus avoid paying taxes on that income. Rather than open business accounts for depositing business receipts and income, they allegedly used Lorraine Martin’s personal account to conceal business receipts, as well as an anonymous "private" banking service designed to conceal income from the IRS.

The evidence also showed that the defendants, in order to further conceal their assets and income from the IRS, used multiple business names, such as Banner Technologies, Circle Machine, Preferred Enterprises and Royal Enterprises, to conduct the machine shop business. The defendants also made extensive use of cash and money orders. For example, they allegedly cashed checks under $10,000 in order to avoid federal Currency Transaction Reports, which are required for currency transactions of $10,000 or more.

In October 2009, Judge Lisi sentenced Lapierre to 51 months in prison for his role in the scheme.

Acting Assistant Attorney General John A. DiCicco thanked the U.S. Attorney’s Office for the District of Rhode Island for their assistance in the prosecution of the case. Acting Assistant Attorney General DiCicco commended the IRS Special Agents who investigated the case, as well as Tax Division Trial Attorneys John Kane and Jorge Almonte who prosecuted the case.

http://www.justice.gov/opa/pr/2009/November/09-tax-1249.html