A Michigan business owner has pleaded guilty to underreporting more than $6 million in income and failing to pay payroll taxes on cash wages paid to employees, the U.S. Department of Justice announced Wednesday.
A.K., owner of Specialized Overseas Shipping, admitted in federal court that he filed a false tax return for his international vehicle shipping business and did not collect or remit employment taxes on $249,000 in cash wages paid between 2017 and 2020.
Court documents show A.K. underreported the business’s gross receipts by $6.4 million over that four-year period. His company arranges for vehicles to be shipped to West Africa and other destinations on behalf of third-party clients.
A.K. pleaded guilty to one count of filing a false tax return and one count related to employment tax violations. He faces up to five years in prison for the employment tax offense and up to three years for the false return charge. Sentencing is set for Aug. 14 before U.S. District Judge Matthew F. Leitman in the Eastern District of Michigan.
The case is being prosecuted by the Justice Department’s Tax Division. The investigation was led by IRS Criminal Investigation and the FBI’s Detroit Field Office.
The announcement was made by Acting Deputy Assistant Attorney General Karen E. Kelly.
