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Accountants Behaving Badly: Ex-UAW President Charged with Embezzlement, Not Guilty Plea In Theft Case, Tax Fraud Sentencing

Plus, an accountant in India was arrested for secretly recording videos of women taking baths, and an Oklahoma City accountant was sentenced to 18 months in jail for embezzling more than $175,000 from her former employer.

Former UAW President Gary Jones charged in U.S. corruption probe [Reuters]
Former United Auto Workers President Gary Jones, who is a CPA, was charged on March 5 with embezzling more than $1 million of union funds amid a U.S. corruption probe that has raised the specter of a federal government takeover of the union.

Gary Jones

Jones resigned his post and UAW membership in November after the union removed him from office, as U.S. prosecutors widened a criminal investigation of illegal payoffs in which at least 13 people have pleaded guilty.

Jones was charged with conspiracy to embezzle funds from the UAW from 2010 through September 2019, and with conspiracy to defraud the United States by failing to pay taxes on the money prosecutors charge he stole.

He faces a maximum of five years in prison and a fine of up to $250,000.

Hoboken woman arrested for embezzling hundreds of thousands of dollars from non-profit [Justice Department]
Yezenia Castillo, an accountant for a nonprofit organization in Englewood, NJ, was arrested on March 3 and charged with four counts of wire fraud for allegedly embezzling hundreds of thousands of dollars from the nonprofit, which provides affordable housing to residents of Englewood.

Yezenia Castillo

From May 2015 to August 2016, Castillo, 44, issued unauthorized checks made payable to herself or entities she controlled, according to authorities. She forged the signature of the president of the company’s board of directors on those checks, representing to the company that the payments were for legitimate business expenses, including tax payments to be made on behalf of the company. A review of bank records during this period didn’t identify tax payments made by Castillo to the IRS or the state of New Jersey on behalf of the company.

The media release from the Justice Department didn’t name the nonprofit, but the Daily Voice reported it was the Great Englewood Housing Corp.

Moore woman sentenced to 18 months in prison for embezzling more than $175,000 from former employer [Justice Department]
Annika Martin was sentenced to 18 months in prison on March 6 for embezzling more than $175,000 from an Oklahoma City business that specialized in cooling tower and industrial plant repairs.

Martin, 35, who pleaded guilty on Aug. 13, 2019, must also pay restitution of $175,294.63 to the business.

According to authorities, the business hired Martin in 2010 as an office accounting assistant. Martin was later promoted and worked as head accountant at the business from 2012 until she was fired in August 2016.  During her tenure as head accountant, Martin prepared an unauthorized check to be drawn on a business checking account to purchase three money orders, which she used for lifestyle expenses, including a car loan payment.

Martin also gave herself unauthorized pay raises, paid herself overtime salary and vacation that she did not work or earn, reimbursed herself for work expenses that she did not incur, and used a company credit card for personal purchases, authorities say.

Duluth accountant pleads not guilty in theft cases [Duluth News Tribune]
Jesse David Frye formally pleaded not guilty on March 3 to two felony theft charges totaling more than $350,000.

Jesse David Frye

In entering the pleas, Frye, 39, who owned Eagle Accounting in downtown Duluth, waived any challenges to probable cause or constitutional issues in cases involving the Duluth Area Chamber of Commerce and a yet-undisclosed area business.

Authorities said more than $235,000 was discovered missing from the Chamber during a routine financial review conducted last July. Chamber officials contacted the Duluth Police Department, which found that Frye allegedly had been withdrawing funds and depositing them into his own accounts, often disguised with the label “payroll,” over a two-year period.

The second case came to light in late December when a business owner reported that he had been contacted by Frye’s brother, also an accountant, who informed him of $122,000 missing from his business, according to court documents.

Former tax preparer sentenced for tax fraud [Justice Department]
Sebastian Adzadi, a former tax preparer in Worchester, MA, who operated Skylimits Tax Service and Consulting, was sentenced in federal court on March 2 to time served, one year of supervised release, and was ordered to pay restitution of $131,077.

Adzadi, 45, pleaded guilty last October to one count of aiding and assisting in the preparation and presentation of false income tax returns.

For tax years 2013 through 2016, Adzadi prepared hundreds of tax returns for numerous clients that included false Schedule A itemized deductions, including medical expenses, charitable contributions, and unreimbursed business expenses, authorities said. The IRS estimates that Adzadi’s fraud caused a total loss of approximately $829,000.

Other accountants behaving badly:

  • Accountant films women taking bath, arrested [Times of India]
  • Accountant arraigned for allegedly defrauding employer of N37,799m [The Nation]
  • Melbourne accountant convicted for false, misleading invoices [Accountants Daily]
  • Chartered accountant faces hearing for alleged illegal condo marketing scheme [Richmond News]
  • Local accountant stole nearly £50,000 from Westcountry Rivers Trust [Okehampton Times]
  • Blackburn husband and wife jailed over £45,000 fraud [Lancashire Telegraph]