From the U.S. Attorney’s Office in Baltimore:
Government Contends that the Scheme Resulted in Losses to the IRS, Maryland Comptroller, and Individual AccuPay Clients of Approximately $2.6 Million
Baltimore, Maryland – Kevin Carden, age 55, formerly of Bel Air, Maryland, pleaded guilty today to wire fraud and to filing a false tax return, arising from a scheme to steal money from his clients and the IRS. The guilty plea was entered just before Carden’s trial was scheduled to begin.
The guilty plea was announced by United States Attorney for the District of Maryland Rod J. Rosenstein; Special Agent in Charge Thomas Jankowski of the Internal Revenue Service – Criminal Investigation, Washington, D.C. Field Office; and Special Agent in Charge Kevin Perkins of the Federal Bureau of Investigation.
“When customers realized that the money they entrusted to AccuPay was not being used as intended to pay their taxes, Kevin Carden misled them with false cover stories,” said U.S. Attorney Rod J. Rosenstein. “What really happened was that Kevin and Beverly Carden took money intended for the IRS and spent it themselves, causing millions of dollars in losses to their customers.”
According to his plea agreement, until its closure in March 2013, Kevin Carden and his wife, Beverly Carden operated AccuPay, Inc. which provided payroll and payroll tax services to small and medium businesses. Kevin Carden ran the company’s “tax department,” which was responsible for handling the employment tax portion of the business. AccuPay received funds from its clients that it held in trust to pay over to the IRS and the Comptroller of Maryland for AccuPay’s clients’ employment taxes. Kevin Carden was responsible for transferring the client funds to make the required tax payments.
During the course of the fraud scheme, which Kevin Carden admitted lasted from 2010 to March 2013, AccuPay withdrew from the clients’ funds the full amount of payroll taxes owed, but then paid the taxing authorities only a portion of the funds. While AccuPay falsely represented to its clients that it paid all of the taxes owed, in fact, Beverly Carden diverted some of those funds to a joint personal bank account that she and her husband maintained which the couple then used to pay personal expenses.
Because of the Cardens’ failure to fully pay existing tax obligations owed by their clients, both the federal and state taxing authorities imposed interest and penalties on AccuPay’s clients, thereby further increasing the magnitude of their tax obligations. Thus, the payments that the Cardens did make to the taxing authorities in part were being applied to pay interest charges and penalties imposed as a result of underpayments earlier in the scheme.
The Cardens used various methods to cover up their diversion of funds and to allay their clients’ concerns when they learned that the taxing authorities had apparently not been paid the full amounts they were supposed to receive. For example, in the instances in which AccuPay’s clients confronted employees at AccuPay about the underpayment of their taxes, Kevin Carden either told those clients that the underpayment would be addressed or (in some cases) avoided their inquiries. Kevin Carden further represented to those clients with whom he spoke that the underpayment was due to (1) a mistake by the taxing authority; (2) an error made by AccuPay employees; and/or (3) problems with the software AccuPay used to file tax returns. These representations were often untrue.
In addition, as a further means of covering up their diversion of funds and allaying their clients’ concerns, in late 2011 AccuPay sent a letter to their clients stating that they had hired a Chief Financial Officer (CFO) to audit all tax deposits and filings for all tax clients back to 2009 “for correctness, compliance, and completeness.” In fact, that individual was not AccuPay’s CFO, but rather was an independent tax preparer the Cardens had hired to prepare their own personal taxes and the corporate taxes of AccuPay, rather than those of the clients.
In 2012, a client of AccuPay confronted representatives of AccuPay with the fact that the company had failed to pay over $300,000 in taxes owed from 2008 to 2012. In response, AccuPay paid the client’s tax deficiencies.
Kevin Carden admits that the amount of loss arising from this scheme is at least $250,000, but the government will argue that the loss amount is approximately $2.6 million.
Carden also admits that he filed a false individual tax return for 2011 in which he did not report the amount of payroll taxes that had been diverted from AccuPay’s clients to the Cardens’ personal account. Kevin Carden admits that the amount of loss arising from the false tax return offense is between $40,000 and $100,000, but the government will argue that the loss amount is approximately $144,720.
As part of his plea agreement, Kevin Carden will be ordered to pay restitution in the full amount of the victims’ losses, including both the IRS and the individual clients of AccuPay.
Kevin Carden faces a maximum penalty of 20 years in prison for wire fraud, and a maximum of three years in prison for filing a false tax return. U.S. District Judge Marvin J. Garbis scheduled sentencing for May 18, 2016, at 10:00 a.m.
Beverly Carden, age 53, formerly of Bel Air, Maryland, previously pleaded guilty to mail fraud and filing a false tax return, and is also scheduled to be sentenced on May 18, 2016, at 10:00 a.m.
Today’s announcement is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force (FFETF) which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Since the inception of FFETF in November 2009, the Justice Department has filed more than 12,841 financial fraud cases against nearly 18,737 defendants including nearly 3,500 mortgage fraud defendants. For more information on the task force, visit www.stopfraud.gov.
United States Attorney Rod J. Rosenstein commended the IRS – Criminal Investigation and FBI for their work in the investigation. Mr. Rosenstein praised the Bel Air Police Department for their assistance in the investigation, and thanked Assistant U.S. Attorneys Evan T. Shea and Jefferson M. Gray, who are prosecuting the case.
Judge Carr closed eyes and allowed this to happen for an extra 2 years when he could have put an end to it. Don’t let him take any credit for stopping this like he did in some local newspapers. Because of his negligence on the bench many people lost their businesses and their life savings. The Carden’s are a bunch of thieves and any punishment will not be enough to justify what they did. I hope they die in jail the way they killed many peoples dreams.
I love the way Carr is portrayed as this great Judge and that he RETIRED from the Administrative Position, when in fact he was ousted by the Chief Judge of Circuit Courts. He has MANY complaints, however, most remain confidential by the Regulatory Agencies. He has been breaking the law and violating the constitution for over 20 years and he has absolutely no honor or integrity. This one reprimand is really all you can find on the internet, yet he has so many confidential violations its not even funny. I leave you with this ……http://www.courts.state.md.us/cjd/pdfs/cjd20131382014002022089privatereprimand.pdf
The judge is obviously dripping with greed, but the real culprit here is the Cardens; Mr. & Mrs. I’ll bet both of them are card-carrying republicans.
Wouldn’t it be interesting to discover if there is a more to the relationship between the Judge and the Cardens than a straight forward judiciary one?
One can only wonder.
You would lose on your bet that they are card carrying Republicans. They are both Democrats who believe that the hard earned money from business owners should be used to enhance the lifestyle of others. That is the socialist way.
By the way, can you explain the difference (if there is one) between a Socialist and a Democrat? Several high level national Democrats have been asked this question on national tv and none of them seem to be able to answer the question.
Zdravstvuyte!
By definition, ‘Socialism’ is the economic theory of community property. The Socialist Party, formed in this country in the early 1900’s, pushed this theory. (No one owns anything because everyone owns everything! Yay! That’ll work!)
I think the word you were seeking was ‘Communism’… a political theory, which at it’s base shares the ‘power to the people’ principles supposedly held dear by the Democratic Party. The difference being that Communists believe in Socialism and Democrats believe in the individual’s right to own property.
You were accurate in your claim that several democrats couldn’t answer the question you posed…. pretty sad reflection on the voters.
And, yeah… I agree with you… too often, people ascribe political affiliation to the actions of individuals. Who cares if the Cardens are Republicans or Democrats? There are s^&%heels in both parties.
Thank you for setting me straight.
@Interesting Question
Well, Hello to you also.
I agree, it is very sad that many of the top level Democrats could not answer the question: What is the difference between a Socialist and a Democrat?
What is even more interesting is the fact that Ms Wasserman-Shultz (Chairman of the DNC) after being surprised by Chris Mathews asking her the question, has yet to come up with an answer, some 5 weeks after being asked the question. This is further compounded by other top level Democrats being asked the question and not being able to provide an answer. One might just surmise that, in the minds of top Democrats, they, in fact, see no difference and are ashamed to admit it.
Do you suppose that they are really Communists at heart, or just dumb Democrats?
FYI – Socialism is the THEORY that a country’s land, transport, industries, etc, should be owned or controlled by the community as a whole.
Communism is a political system in which all property is owned by the community.
Marxism is the political and economic theories of Karl Marx and Friedrich Engels, which formed the basis for communism.
The basic Marx/Engle theory is: from each according to their abilities to each according to their needs.
In a real world, such altruism does not exist. The United Soviet Socialist Republic (CCCP) was the experiment that sought to prove the theory. Unfortunately, the theory did not take into consideration the nature of the human animal.
Democracy on the other hand does allow for private ownership of land, capital and labor.
The Republicans, however, want to own all the land, labor and capital, and use it according to their needs, not the needs of the community.
Forever Amber, what the hell does Republican or Democrat have to do with it?? I was a victim and I’m a Republican, hell probably most of the victims are Republicans considering Democrats sit home and collect Government checks, smoking weed, and aborting babies. So keep swiping that liberal card every time you go to the grocery store and be thankful for us Republicans so you can have that independence card.
Somebody didn’t take their crazy pills.
I am sorry to hear when anyone gets the royal shaft. You are justified in your anger.
Girl you are plumb dumb
We are entitled to our opinions. Why would there be two political parties?
That’s the problem…. we went from a government that represented a variety of ideas and theories to just the two remaining behemoths that are so embroiled in their own ideology and branded philosophies that they can’t get anything accomplished.
Perhaps it is time for like-minded individuals to start a new (not Independent) party with main stream (read issues of interest to the middle class rather than big money) concerns. Are you game?
Sure….. I was looking for a good way to spend my imaginary powerball winnings….
But, I’d settle for a candidate (any candidate) that I didn’t suspect of being halfway to crazy.
lol @ card carrying Republicans. What the fugg, yo? Good grief people spiel their vitrol for politics in everything.
I bet you’re a card carrying national socialist. Angle your right arm at 45 degrees straight in front of you
Card carrying Republicans? Democrats? Huh? lol
What’s your NSDAP number?
What’s yours? The NSDAP or Nazis were never true socialist nor did they believe in any other life-affirming philosophies..
You should’ve told “Lord Action” that the new NSDAP numbers are actually called Republican Voter Registration Numbers…..
Who the hell is “Lord Action” and what the fuck are you talking about?
Lord Action is who you were responding to. Man, you are a little out there aren’t you….
…. ‘The pot calling the kettle black’….. or, Pothead… as it were. lol…. I’m sitting back down now.
I’m your daddy.
What’s my NSDAP number? I asked you, since you’re all about making everything political.
Extend your right arm straight at 45 degrees.
@ the “Peter Puffer” – Nice screen name…. I guess if I had said “Knob Slobber” you’d have used that one too! Here’s another name you’d like, “Pickle Warmer”…..
Nah…. ‘Knob Slobber’ doesn’t roll off the tongue (pun intended) quite the same way as your first choice.
Roll a fat one and invest some of those tax payer dollars into a Thesaurus.
You keep going to that marijuana issue, is that ALL you got. Do you really think that I consider that an insult? How bout I use some of that TAX PAYER money to get me some Opiates from a pain management program? Would you approve of that? How bout I just SELL those pain pills and make lots of money off of TAX PAYER money? Would that make you happy? You’re just a malignant pap smear taken from the crotch of society……
No. I think you’re too stupid to see it as an insult.
Do you think I care what you do with your welfare checks? I’m doing what I’m supposed to do, Soultrain. I grew up. Got a job. Pay my taxes.
So, spend your welfare money however you see fit – go out and buy your opiates – I really don’t care. I’m doing my part.
And, really, the only ones who suffer are the little kids and the old folks who get less benefits because the system is spread so thin by entitled brats like yourself.
Have a nice day!
Look, oh mighty Puffer of Peters, I do not receive welfare, have an Independence Card or have FREE Health Insurance. However, my sister does and I’ve played the role here on the Dagger as a joke. However, only a hopeless loser such as yourself believes in the GARBAGE you preach. I don’t think you ever grew up, have a job or pay any taxes. You know why? Because you’re on the Dagger spewing Republican Hatred each and every day using multiple screen names. You wanna impress me, be a man and Identify yourself. Everyone who reads the Dagger regularly knows who I am, so let’s see who you are….
Do I hear sabers rattling?….
Ha! You are correct – You’ve chosen to reveal quite a bit about yourself on The Dagger…. Let me see… You are a failed pot farmer with bad ankles who blames the HCSO for being caught ….. you frequently claim to be ‘the truth’…. You claim that all Republicans are racist…. You like to bring up the Nazi party a lot…. most of your insults are rather juvenile and penis related…. and, you have some weird fascination with ‘Marc’ and ‘Shaun’. I think that about covers it.
Why would I have any interest in impressing you???
The truth is, I know hundreds of young men and women who come from bad circumstances…. they made their mistakes… some, far worse then yours…. Some were born into horrible circumstances…. But, they were all denied, for one reason or another, opportunities to fully explore their potential.
But, you know what? Most of them are trying.
They work crappy shifts…. they walk the line… they save their money…. They’re proud of their 20 year old cars because they bought them…. with their own money. And, they are proud of their little apartments… because they keep their bills paid and they keep the lights on. They don’t let their past prevent them from having a future, and, They Are Making It. Those are the people who I care to impress.
I’m not a Republican, a Democrat, a Socialist, a Communist or a Nazi. I’m an American.
Take your posturing elsewhere.
No. That’s the sound loose screws make when they start rolling around.