A local man's seven-year charade of fabricating earnings and tax withholdings on federal tax returns has finally ended with his admission of guilt. U.S. Attorney Nicholas J. Ganjei's office has disclosed that Joseph Patrick Butler has agreed to plea guilty to filing false tax statements between the years of 2013 and 2020, swindling the government out of more than $260,000 in tax refunds. According to the announcement made by the U.S. Attorney's Office for the Southern District of Texas, Butler created fictitious companies solely for the purpose of generating fake W-2 forms that reported inflated wages and tax withholdings.
By acknowledging the ruse, Butler now faces a substantial penalty for his actions. When U.S. District Judge Sim Lake determines Butler's fate on July 18, the defendant could receive up to three years in a federal prison and be ordered to pay up to a $250,000 fine. In the interim, with the sentencing still a couple of months out, Butler has been allowed to remain on bond.
The IRS Criminal Investigation unit uncovered Butler's scheme, leading to his prosecution for creating shell companies and defrauding the federal government. Assistant U.S. Attorneys Brad Gray and Shirin Hakimzadeh are handling the case and have detailed Butler’s actions in court.
Butler's admission included the acknowledgment that no actual wages had been earned and no taxes had been withheld by these non-existent companies that he conjured.
