Jury begins deliberating in tax fraud trial of Chelsea businessman

Posted Oct. 02, 2013, at 3:15 p.m.
Last modified Oct. 02, 2013, at 4:52 p.m.

BANGOR, Maine — A jury of seven women and five men began deliberating about 2:15 p.m. Wednesday in the tax fraud trial of a Chelsea businessman.

Marshall Swan, 56, is 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, according to the prosecution.

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.

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

Assistant U.S. Attorney Donald Clark, who prosecuted Carole Swan, 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.

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.

If convicted, 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.

He has been free on bail since pleading not guilty to the charges in March 2012.

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.

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