A Reisterstown man faces over a year in jailtime and must pay nearly $350,000 in restitution for tax evasion.
Randy Benjamin Wells, 49, was sentenced to 13 months in prison, followed by three years of supervised release and was ordered to pay restitution of $349,588. The sentence was announced Tuesday by U.S. Attorney for the District of Maryland Rod J. Rosenstein and IRS special agent Rick A. Raven in a press release. Wells paid the IRS $74,404.30 prior to his sentencing.
"Today's sentence sends a strong message that tax evasion will be vigorously pursued by IRS," stated Rick A. Raven, special agent in charge of the IRS Criminal Investigation division in the Washington, D.C., Field Office. "Tax compliance should be equally shared among all Americans. Business owners like Mr. Wells who choose differently are being held accountable, reminding the public that there are detrimental consequences for this type of criminal behavior."
Wells operated three contracting companies—Wells Contracting and Demolition Company, Triple R Contractors and Gryphon Contracting—from 2005 to 2009, and failed to file income tax returns with the IRS for the companies. Although he did file his individual tax returns for those years, the failure to file for the contracting companies resulted in $196,200 in taxes owed, according to the press release.
Wells concealed his income by using funds in the Wells Contracting and Demolition account to purchase personal items like airline tickets, retail items from department stores, subscriptions to Direct TV and Netflix, golf course visits and hotel stays. He also purchased tickets for personal travel using the Gryphon account, according to the press release.
In addition to concealing income, Wells did not pay employment taxes for the employees who worked for his companies. He failed to file the required quarterly Employer’s Federal Tax Return forms from 2005 to 2009, he paid subcontractors with cash, formed Triple R to evade employment taxes owed by Wells Contracting and then formed Gryphon to evade employment taxes owed by Wells Contracting and Triple R. These actions resulted in $227,792.76 in employment taxes owed, the press release said.