Jury finds Chelsea businessman guilty of tax fraud

By Judy Harrison, BDN Staff
Posted Oct. 02, 2013, at 4:54 p.m.

BANGOR, Maine — A federal jury of seven women and five men Wednesday found a Chelsea businessman guilty on five counts of tax fraud after deliberating for two hours.

Marshall Swan, 56, was charged with knowingly underreporting the income from his construction business to the IRS between 2006 and 2010 by nearly $650,000. Swan and his wife, Carole Swan, owe more than $145,000 in income and self-employment taxes, not including penalties and interest, according to the prosecution.

Swan, who did not take the stand in his own defense, remains free on bail awaiting sentencing.

A sentencing date has not been set.

Marshall Swan’s trial began Monday in U.S. District Court.

Assistant U.S. Attorney Donald Clark, who prosecuted Carole Swan earlier this year, told the jury Wednesday in his closing argument that because Marshall Swan wrote out bids for customers, collected money from them and deposited checks into business and personal accounts, he had to have known how much money he was making.

Clark, whose office is in Portland, left the Margaret Chase Smith Federal Building after the verdict was announced without speaking to reporters.

Defense attorney Walter McKee of Augusta told jurors in his closing that the prosecution had proven Carole Swan was guilty of tax fraud but not that her husband was guilty of the same crime. McKee urged jurors to compare Marshall Swan’s signature on the tax returns to his signature on a bank signature card. McKee said they did not match.

McKee rested his case without calling any witnesses.

“We’re deeply disappointed in the verdict, but respect that it’s been rendered,” he said after the verdict was announced.

He said that Marshall Swan continues to operate his construction business from his Chelsea home.

Carole Swan, 55, was convicted in July of the tax fraud counts and two counts of workers’ compensation fraud. A selectwoman in Chelsea for 19 years, she was convicted last month on three counts of extortion.

Jurors in the first trial rejected her contention that she was justified in breaking the law due to alleged abuse at the hands of her estranged husband. Through his attorney, McKee, Marshall Swan has denied the abuse. He has not been charged with domestic violence assault.

In her second trial, jurors rejected Carole Swan’s claim that she was taking $10,000 in cash from a Whitefield contractor whom she believed was offering kickbacks to elected officials so she could take evidence of his wrongdoing to the Kennebec County district attorney.

Marshall Swan faces the same penalty his estranged wife does on her tax fraud convictions — up to three years in prison and a fine of up to $250,000 plus back taxes, interest and penalty payments.

Carole Swan faces up to 20 years in federal prison on the extortion convictions. She also faces up to five years for workers’ compensation fraud.

In addition to prison time, Carole Swan could be ordered to pay fines of up to $250,000 on each count and to repay workers’ compensation funds she illegally received as well as back taxes, interest and penalties.

Her sentencing date has not been set. She remains free on bail.

Carole Swan no longer lives with her husband in their Chelsea home, according to her attorney Leonard Sharon of Auburn.

McKee said after the verdict Wednesday that he has not discussed his client’s relationship with Carole Swan or whether they plan to divorce.

http://bangordailynews.com/2013/10/02/news/bangor/jury-finds-chelsea-businessman-guilty-of-tax-fraud/ printed on September 19, 2014