The president of a company that hosted tax forums for the Internal Revenue Service has been sentenced to five years in prison for defrauding the IRS of more than $1 million.
U.S. District Judge Roger W. Titus sentenced Brosim S. Ekpone to the jail term, followed by three years of supervised release, and ordered him to pay $1,379,630 in restitution. Ekpone was convicted of conspiracy to defraud the U.S. and obstruction of a federal audit in connection with a conspiracy to submit false invoices under a contract between the IRS and Ekpone's former company, Public Affairs International, according to the Justice Department.
PAI, based in Silver Spring, Md., entered into a contract with the IRS to organize and host programs that described changes in federal tax law, as well as IRS policies. Under the contract, PAI was supposed to use the fees from attendees and exhibitors at the tax forums to pay for expenses, and use the surplus at the end of each fiscal year to offset PAI's management fee under the contract. The IRS was then expected to pay any unpaid balance after the tax forum income was applied to the fee.
However, from 2000 through 2003, Ekpone and PAI vice president Ketan R. Shah allegedly under-reported the tax forum income and over-reported the expenses so there appeared to be no surplus income to apply to the management fee at the end of each fiscal year. As a result of the false invoices, the IRS paid PAI management fees totaling approximately $1,379,630.
In October 2003, the Office of Audit of the Treasury Inspector General for Tax Administration began auditing PAI's records and subpoenaed the company to produce any documents on its earnings and expenses under the contract. After PAI received the subpoena, Shah and Ekpone told PAI employees to alter or manufacture invoices from vendors to increase the company's apparent expenses, and change the records of the fees participants paid, thereby reducing PAI's apparent income. Ekpone and Shah also failed to provide certain documents requested in the subpoena.
Shah pleaded guilty to the same charges as Ekpone. He was sentenced on Sept. 24 to 30 months in prison and ordered to pay restitution of $1,379,630.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access