WASHINGTON D.C.
Rather than paying the employment taxes that were due and owing to the IRS over the four-year period, Jeffrey Normal Jackson diverted money from the company he owns Innovative Security Services LLC in Washington D.C., according to officials.
Jackson used company funds to pay rent and buy furniture for his personal residence, spent more than $21,000 at the men’s clothing store Everett Hall and made other personal expenditures at Nordstrom and Tiffany & Co.
Jackson also paid more than $10,000 for his gym membership and personal training sessions and paid $10,000 to his childcare provider.
Today, a federal judge sentenced Jackson to three years and six months in prison for employment tax fraud, officials said.
“Business owners have a responsibility to their employees and the IRS to honestly collect, account for and pay over employment taxes to the IRS,” said Acting Deputy Assistant Attorney General Wszalek. “As evidenced by today’s sentencing, employers like Jeffrey Jackson, who willfully evade their employment tax obligations, will be prosecuted to the fullest extent and face lengthy terms of imprisonment and substantial financial penalties.”
Jackson, who currently resides in Maryland, previously pleaded guilty to failing to file federal employment tax returns and failing to pay about $600,000 in employment taxes.
In addition to three years and six months in prison, Jackson was sentenced to three years of supervised released, ordered to perform 360 hours of community service and ordered to pay $595,687.39 in restitution to the IRS, officials said.
From 2006 through 2010, Jackson controlled the company’s finances and was responsible for filing the Employer’s Quarterly Federal Tax Returns. He was also responsible for paying over to the IRS the federal income, social security and Medicare taxes, known as Federal Insurance Contributions Act or FICA taxes, that were withheld from the wages of Innovative’s employees, according to authorities.
Officials said Jackson has a previous federal conviction related to the theft of employment taxes.
In 2006, he pleaded guilty to bankruptcy fraud after he stole $373,429.57 from a bank account that was set up to pay the payroll taxes for Jackson’s former company, Unlimited Security Inc., while that company was proceeding through Chapter 11 bankruptcy.
In that case, officials said Jackson used the stolen funds to support a boxing promotion business that he controlled and to pay professional boxers.