West Virginia Ambulance Services Business Owner Convicted of Tax Crimes

A federal jury in Beckley, West Virginia, convicted a man yesterday for failing to pay the taxes withheld from employees' wages at an ambulance service he operated and for obstructing the IRS.

According to evidence presented at trial, from 2012 through part of 2017, Christopher Jason Smyth operated Stat EMS LLC, an ambulance service located in Pineville, West Virginia. Smyth created Stat EMS after a previous ambulance business Smyth operated accrued millions of dollars of employment tax liabilities and filed for bankruptcy. Smyth caused Stat EMS to be founded in the name of a nominee owner but continued operating the business in the same manner as before.

At Stat EMS, Smyth was responsible for withholding Social Security, Medicare and income taxes from employees' wages and paying them to the IRS. For two quarters in 2016, Smyth, however, did not fully pay the taxes to the IRS. Instead, he paid various personal expenses and transferred funds to businesses held by his friends and family.The IRS determined that Stat EMS accrued approximately $3.3 million in unpaid taxes.

Eventually, the IRS assessed the unpaid taxes against Smyth personally and attempted to collect those from him. When interviewed by an IRS revenue officer attempting to collect Smyth's unpaid tax debts, Smyth stated that he had no personal bank accounts and denied that he used anyone else's. In reality, however, he regularly deposited his paychecks into an account in a relative's name. He also attempted to mislead the revenue officer by representing that he had nothing to do with several other businesses, even though he had signature authority over their bank accounts.

The jury found Smyth guilty of two counts of failing to pay over taxes for two quarters in 2016 and one count of obstructing the IRS related to its efforts to collect the unpaid taxes from Smyth. It found Smyth not guilty on the failure to pay over taxes counts related to two quarters in 2017. Smyth is scheduled to be sentenced on Sept. 4 and faces up to up to five years in prison for each failure to pay taxes count and three years in prison for obstructing the IRS. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department's Tax Division and U.S. Attorney William S. Thompson for the Southern District of West Virginia made the announcement.

IRS Criminal Investigation investigated the case.

Assistant Chief David Zisserson, Trial Attorneys Kavitha Bondada and Andrew Ascencio of the Tax Division, and Assistant U.S. Attorney Erik Goes for the Southern District of West Virginia, prosecuted the case.