A 58-year-old Falmouth man faces up to five years in prison after pleading guilty Monday to nearly a decade’s worth of tax evasion.
Federal prosecutors say Jeffrey Riddle filed income tax returns between 2006 and 2014 that showed he owed substantial federal taxes, but did not pay them
They also say he lied about being unable to pay overdue taxes for years and eventually bought an island home and a Corvette.
According to a release from the U.S. Attorney’s Office District of Maine, Riddle created a new business, Silica Marketing LLC, while still owing substantial back taxes in 2015.
Prosecutors say Riddle then put the ownership of the company under his then-wife’s name despite the company’s sole revenue coming from his consulting work. They say he used the money he earned to pay personal expenses.
When meeting with the IRS officer assigned to collect his back taxes, Riddle stated that he earned $6,000 a month in wages from Silica and provided the IRS with a falsified letter showing he would be paid a $3,000 bi-monthly salary. At the time, he had and entered into a lucrative consulting agreement with a large tire retailer.
Prosecutors say he failed to disclose that he had signed a consulting agreement as Silica’s president and CEO and that Silica was receiving substantial income from that contract. They say Riddle also failed to disclose that money paid to Silica was being used to pay his personal expenses. Among the expenses paid for with Silica funds was the down payment on a home on Great Diamond Island in 2016, purchased in Silica’s name.
In 2017, prosecutors say Riddle created a new company to replace Silica, while continuing to consult with the same tire retailer. In 2020, they say he sold part of the company for $400,000, and $250,000 was placed in escrow for the purpose of satisfying Riddle’s tax debt. But none of those funds were paid to the IRS. On the day the partial sale of his company closed, Riddle purchased a Corvette, listing it in his company’s name.
Riddle faces a fine of up to $250,000 in addition to his possible prison sentence.
