Tag Archives: Internal Revenue Service

Santa Ana: O.C. Man Gets 4 Years In Federal Prison

STAFF REPORTS

Santa Ana – The owner of a Huntington Beach-based military contractor, who plead guilty to federal tax charges for failing to report millions of dollars to the Internal Revenue Service that his company received for providing services to the military at Baghdad International Airport, was sentenced on Fri., Sept. 5 to 48 months in federal prison.

According to the United States Attorney’s Office, Nadim “Nick” Saifan, Jr., 48, of Huntington Beach, was sentenced by United States District Judge Cormac J. Carney.

Saifan pleaded guilty in May to two counts of attempted tax evasion and specifically admitted that he substantially underreported income on his company’s 2005 corporate tax return and his personal tax return for 2006.

Saifan was the owner and operator of Defense Logistical Support & Services Corporation (DLSS), which provided services to the military and some civilian companies in Iraq. From August 2004 through October 2007, DLSS received nearly $16 million from the United States military for services in Iraq, according to court documents that state Saifan reported only a small fraction of this income on DLSS’s corporate tax returns filed with the IRS. The court documents also show that Saifan used foreign bank accounts, specifically in Lebanon, to conceal his assets and profits from DLSS Corp.

“In addition to failing to report the millions of dollars in taxable income on DLSS Corp.’s tax returns, [Saifan] also used substantial corporate funds for personal purchases and payments to himself, without claiming these distributions and payments as income to himself on his individual tax returns,” prosecutors wrote in a sentencing memo filed with the court. Saifan used corporate money to make approximately $880,000 in down payments on real estate and approximately $292,000 in payments toward vehicles that included a Ferrari and a Rolls-Royce.

Saifan has been in federal custody since Judge Carney revoked Saifan’s bond in May.

The case against Saifan was investigated by the Defense Criminal Investigative Service and IRS Criminal Investigation.

 

Corona Woman Arrested Again For Fraud

Staff Reports

Corona – A Corona woman, who is already charged with a $15 million bank and bankruptcy fraud, was arrested on Tues., July 1, on a new charge.

According to a news release from the United States Attorney’s Office, Carolyn Marie Jones, 51, of Corona, Chief Executive Officer of a high-end denim jean company, was arrested by Special Agents with the United States Secret Service and the Internal Revenue Service pursuant to a criminal complaint issued on June 30 by a federal judge.

According to the criminal complaint, which includes wire fraud, Jones scammed two Georgia men in an investment scheme.  The complaint states that Jones convinced the men to invest with her, but spent the money on her own personal expenses. Jones, who was out on bond pending a September 23 trial in the bank and bankruptcy fraud case, was prohibited from soliciting money from investors while awaiting the trial.

According to the 19-count indictment returned by a grand jury in September 2013, Jones was the Chief Executive Officer of Diamond Decisions, Inc., which sold denim jeans marketed under the labels of Privacywear and PRVCY Premium.  According to the indictment, Jones obtained a $15 million business line of credit from Union Bank, using fake financial statements and fake tax returns, as well as providing the bank with a Social Security number that belonged to someone else.  Jones also hid a previous bankruptcy and felony record from the bank.  The indictment further states that Jones defaulted on the $15 million loan after a year, causing Union Bank to file a lawsuit in state court.  When Union Bank tried to seize the contents of the Diamond Decisions warehouse, Jones caused the company to file for bankruptcy and hid assets from the bankruptcy trustee.

Jones faces a maximum statutory sentence of 489 years in federal prison on the bank and bankruptcy fraud indictment.  Jones also faces a maximum statutory sentence of 20 years on the wire fraud complaint.

The charges in the complaint and indictment are the results of an investigation conducted by the United States Secret Service and the Internal Revenue Service. The U.S. Attorney’s Office states that a complaint and an indictment contain allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty.