CPA sentenced for bank fraud and tax evasion - Arcade Herald / Warsaw’s Country Courier: Latest News

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CPA sentenced for bank fraud and tax evasion

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Posted: Thursday, August 9, 2018 4:00 pm | Updated: 11:16 am, Thu Aug 16, 2018.

BUFFALO — An Olean man was convicted of bank fraud and tax evasion in U.S. District Court for making unauthorized electronic withdrawals and forging checks from a business that held accounts at the Five Star Bank in Warsaw. 

Joseph Stevens, 54, has been sentenced to serve 33 months in federal prison by U.S. District Judge Elizabeth A. Wolford. The defendant was also ordered to pay $512,982 in restitution to the victim and the Internal Revenue Service.

In August 2012, Stevens, a certified public accountant, was hired by a business owner to handle all of the bookkeeping responsibilities for his business. He was in charge of paying vendors, employee payroll, and personal and business tax return preparation. In order to perform the accounting duties, Stevens was given access to the business’ bank account information for the business owner’s two business accounts at a Warsaw Five Star branch.

Beginning in early 2016, the defendant began to notify the business owner that the business was not doing well financially. For instance, a $30,000 line of credit at Five Star Bank was maxed out without authorization. When questioned about the line of credit, Stevens told the business owner that the business was not generating enough revenue. 

Also, sometime in 2016, the business owner received a letter from the Internal Revenue Service stating that his 2015 taxes were not paid. When the business owner questioned the defendant, Stevens again stated the business was not generating enough revenue.

In September 2016, the business owner realized that monthly statements for the Five Star Bank accounts were no longer being received at the business owner’s office. The business owner went to the bank branch March 24, 2017 to review the business accounts activity.

Between August 2012 and April 2017, Stevens made approximately $342,700 in unauthorized electronic withdrawals from the business owner’s accounts to his personal accounts and forged approximately 39 checks, made payable to himself, in the amount of $87,800.

In addition, the defendant failed to file an income tax return for 2015, resulting in a loss of $53,296 to the IRS, and also failed to file an income tax return for 2014, resulting in a tax loss of $29,186.

The sentencing is the result of an investigation by the IRS, Criminal Investigations Division and the United States Postal Inspection Service.

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