Bellevue, Washington, CPA pleads guilty to tax fraud


Date: December 9, 2021


SEATTLE — A Bellevue, Washington, Certified Public Accountant pleaded guilty today in U.S. District Court in Seattle to attempt to evade or defeat tax, announced U.S. Attorney Nick Brown. Steven G. Shimizu, owned and operated a tax preparation business, S&S CPA Corporation ("S&S Corp."). In tax years 2013, 2014 and 2015, Shimizu admits he hid income from his business by attributing it to other entities. In this way he underpaid his taxes by more than $884,000. Shimizu faces up to 5 years in prison when sentenced by U.S. District Judge John C. Coughenour on March 15, 2022.

According to the plea agreement, Shimizu admits he used two business entities, Shimizu & Shimizu ("S&S Partnership") and CS Medical Consultants ("CS Partnership") to evade taxes. In the years at issue, the entities had no business activity and thus no income or expenses. However, for tax years 2013 and 2014, Shimizu attributed income that he earned from his CPA corporation, as income to S&S Partnership. He then created phony business expenses attributable to S&S Partnership. Those expenses reduced the amount of income taxes owed. In tax years 2013-15 Shimizu used the same scheme with the CS Partnership. The scheme hid income from the CPA firm, and then the creation of phony business expenses reduced the income taxes owed.

Additionally, in tax years 2013-15, Shimizu sought to record personal expenses as business expenses on the tax returns for the CPA business. Shimizu characterized withdrawals from business accounts as business expenses, but they were actually cash withdrawals for his personal benefit, personal insurance, personal legal expenses, and payments to family members.

"Tax professionals are essential to the operation of our tax system, and the public puts their utmost trust in these professionals to prepare tax returns truthfully," said Special Agent in Charge Bret Kressin, IRS Criminal Investigation (IRS-CI), Seattle Field Office. "When individuals like Mr. Shimizu break that trust by fraudulently filing false tax returns out of greed, they put their clients and the public at risk by undermining that trust. IRS-CI is continually committed to investigating those who think they are above paying their fair share."

Attempting to evade or defeat tax is punishable by up to 5 years in prison and a $100,000 fine. The actual sentence will be determined by Judge Coughenour after considering the U.S. Sentencing Guidelines and other statutory factors.

The case was investigated by the Internal Revenue Service Criminal Investigation (IRS-CI).

The case is being prosecuted by Assistant United States Attorney Michael Dion.