Michael Carlow, a resident of Pittsburgh, pleaded guilty today to corruptly endeavoring to obstruct the Internal Revenue Service (IRS), the Justice Department and IRS announced. Carlow appeared before U.S. District Judge David Cercone.
In 1996, Carlow pleaded guilty to bank fraud and tax fraud in federal court and was sentenced to eight years in prison. Upon his release in 2002, Carlow resided at the home of his girlfriend, Elizabeth Jones, in Pittsburgh.
According to documents filed in the case, the IRS assessed more than $6 million in overdue taxes, interest and penalties against Carlow for the years 1992 through 1996. However, from 2000 through 2011, in order to thwart efforts by the IRS to collect what he owed, Carlow concealed his assets and income through Jones and eight different nominee corporations. According to documents filed in the case, Carlow maintained a secret interest in various corporations and had fees and royalties paid to Jones rather than to himself. He also failed to report his ownership and control of corporate assets to U.S. Probation and the IRS. Carlow filed false U.S. individual income tax returns for 2003-2006 and failed to file U.S. individual income tax returns from 2008 through 2011. In August 2011, Jones pleaded guilty to her conduct related to acting as a nominee for Carlow.
Kathryn Keneally, Assistant Attorney General of the Justice Department’s Tax Division, commended the investigative efforts of IRS - Criminal Investigation Special Agents, who investigated the case, and Tax Division Trial Attorneys Kenneth Vert and Jeffrey McLellan, who are prosecuting the case.
Sentencing is scheduled for Oct. 4, 2013.