The Certainty of Punishment

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Cropped view of a senior woman receiving help with her finances from her granddaughterhttp://195.154.178.81/DATA/istock_collage/0/shoots/783362.jpg

It was Benjamin Franklin who said the only two certainties in life are death and taxes. But there’s another certainty to consider – punishment for being convicted of tax fraud. When sentenced, Michael J. Tiernan, 62, of Williamsburg, Va., may have to spend some time behind bars for filing false tax returns and failure to file a tax return. (Those are two sure ways to make the Internal Revenue Service (IRS) pretty unhappy with you.)

Prior to getting caught up in all of this tax fraud mess, Tiernan previously served as the financial officer for several business entities related to Ford’s Colony, a secure, multi-generational gated community with more than 2,600 homes, golf courses, ponds, wetlands, and woodlands in Williamsburg. (Sounds like a lovely place to live as well as hard to give up for a 6 x 8 prison cell.) Tiernan was also the former co-owner, chief financial officer and controller of Ford’s Colony Realty, LLC and Southeast Settlement and Title, LLC. (Sounds like he was an extremely busy man keeping all of those businesses afloat.)

It appears that Tiernan might have cooked the books a bit for tax years 2015 and 2016. Court records show that he falsely understated his income from these entities in his federal income tax filings. While he did report earnings, Tiernan also reported high deductions which resulted in zero taxable income for those two years. He also claimed to be insolvent to exclude discharge of debt in 2015.

Tiernan also reported that he earned income of $289,401 in 2015 and $204,523 in 2016 from the Ford’s Colony-related entities, but in 2017, he did not file a tax return. The IRS noticed. The IRS also noticed that Tiernan cashed checks into his personal bank account. He wrote those checks on behalf of the entities mentioned in the amount of more than $1.6 million dollars. (Then he spent almost all of the money using checks and debit card transactions.)

Tiernan was indicted on seven felony counts of bank fraud, two felony counts of filing false tax returns and one felony count of failure to file income tax. When sentenced in March 2022, he is facing a maximum penalty of up to seven years in prison. (Not exactly the way he had planned for retirement, I’m sure.) 

Today’s Fraud of the Day comes from an article, “Williamsburg Businessman Convicted for Tax Fraud,” published by Williamsburg Yorktown Daily dated October 27, 2021.

NEWPORT NEWS — A Williamsburg businessman was convicted in federal court on charges that stem from tax fraud.

On Monday, Oct. 25, Michael J. Tiernan, 62, was convicted on charges of filing false tax returns and failure to file a tax return.

 

 

 

 

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.