IRS and Other Law Enforcement Agencies Target Businesses in Springfield, Massachusetts

Two recent raids targeting businesses in Springfield, Massachusetts suggest that federal and state law enforcement agencies may soon be targeting other similar types of businesses in similarly-sized cities such as Worchester, Massachusetts and Providence, Rhode Island. The raids were conducted by the Internal Revenue Service (IRS) and Federal Bureau of Investigation (FBI) in coordination with Massachusetts State Police and targeted a local strip club and restaurant. It is unclear whether the raids followed an IRS audit or were triggered by other factors.

An AP article discussing the raids also does not indicate whether either business has retained a criminal tax attorney. Further, the investigations and comments thus far have not expressed who the targets of the raids are as of yet. Employees (including dancers, waitresses, hosts and security), as well as management and/or the owners of the establishments might all be potential targets. That said, all of these individuals will need the services of a skilled criminal tax attorney like Kevin E. Thorn.

An FBI spokeswoman is quoted in the article as stating that the agencies involved in the raids, “are conducting court authorized activity in connection with an ongoing federal investigation.” There are no details on the substance of the allegations involved other than an acknowledgement that they do not involve any threats to public safety. However, the IRS’s involvement in the raids indicates that at least some of the allegations are tax-related.

Massachusetts and Rhode Island Businesses Need to Be Aware of Potential Criminal Tax Fraud Investigations

In many cases, the performance of similar raids in such a small time window is indicative of a targeted effort to prosecute alleged offenders in a particular geographic region. Federal agents and prosecutors will often target similar types of businesses during these coordinated efforts as well. As a result, and given their close geographic proximity, businesses in cities such as Worchester and Providence may be facing enhanced scrutiny from the FBI and IRS as well as those in Springfield and the immediately surrounding areas.

What is the IRS Looking For?

When Special Agents with the IRS’s Criminal Investigation Division raid a business, what are they looking for? The specific answer will vary on a case-by-case basis; but, generally speaking, the IRS’s criminal law enforcement efforts target statutory violations that result in the underreporting and underpayment of federal tax liability. This could be income tax, employment tax or excise tax, and it could involve allegations of criminal acts such as:

• Intentionally filing fraudulent tax returns
• Abusing foreign and domestic trusts for tax avoidance purposes
• Abusing foreign bank accounts
• Financial institution or insurance fraud
• Public corruption or bribery
• Narcotics distribution or organized crime
• Tax evasion
• Failure to file tax returns or pay taxes
• Money laundering

As the target of an IRS audit or a federal criminal tax fraud investigation, it is imperative not to make any assumptions about the scope of the investigation or your business’s guilt or innocence. These inquiries can involve extraordinarily complex issues and the consequences can be severe, so the best course of action is to hire a criminal tax attorney immediately. Other potential results beyond a criminal investigation could be severe civil audits that result in additional tax, penalties and interest.

Speak With a Criminal Tax Attorney at Thorn Law Group

If you need a criminal tax attorney in Springfield, Worcester, Providence or elsewhere in Massachusetts or Rhode Island, we encourage you to contact us for a confidential initial consultation. To speak with Attorney Kevin E. Thorn, Managing Partner of Thorn Law Group as soon as possible, call 617-692-2989 or get in touch online now.