Pa. man charged with using two Maine companies in attempt to avoid paying Uncle Sam

By Nick McCrea, BDN Staff
Posted April 13, 2012, at 3:37 p.m.

BANGOR, Maine — A Pennsylvania man has been arrested on charges of attempted tax evasion after using cash from two Maine companies in an attempt to dodge paying personal income tax, according to the U.S. Department of Justice and Internal Revenue Service.

Stephen W. Thomas of York, Pa., has been arrested after a federal grand jury in the District of Columbia returned a three-count indictment, which states that Thomas did not file individual income tax returns from 2005 through 2007.

In 2004, Thomas allegedly formed multiple companies whose names contained the acronym ECG, which stands ESOP Capital Group. ESOP is an acronym for employee stock ownership plan. Thomas claimed the capital group offered financial, business and other management services to companies interested in creating employee stock ownership plans, according to the indictment.

In 2005 and 2006, Thomas, through his companies, contracted to help two unidentified Maine businesses, the indictment said.

The names and locations of the Maine companies, as well as what they did for business, are being withheld, according to Jessica Crocker, a public information officer for the criminal investigation division of the IRS.

The indictment alleged that Thomas earned income between 2005 and 2007 but evaded taxes by diverting cash from the two Maine companies, using “nominee” bank accounts, titling assets in his spouse’s name and withdrawing substantial amounts of cash.

Thomas also used funds from a credit line of one of the companies to purchase his home, the indictment alleges.

If convicted,Thomas faces up to five years in prison and a maximum $250,000 fine on each count.

http://bangordailynews.com/2012/04/13/news/bangor/pa-man-charged-with-using-two-maine-companies-in-attempt-to-avoid-paying-uncle-sam/ printed on July 26, 2014