Chesterfield man pleads guilty to $1.3 million tax fraud


Date: May 26, 2022


Richmond, VA — A Chesterfield man pleaded guilty today to failing to pay over to the Internal Revenue Service (IRS) payroll taxes that were deducted from his employees' paychecks.

According to court documents, from at least 2014 to 2018, David Corey Warren failed to pay over to the IRS payroll taxes from three different companies owned by his family. Warren served as the Director of Operations for Transitional Adult Residential Center, Transitional Home Care, and Elkridge Gathering Center, companies providing group homes, home care nurses, and daycare center services for mentally disabled adults in Chesterfield and Richmond. As Director of Operations, Warren was responsible for withholding the required Medicare, Social Security, and federal income taxes from his employees' wages, and paying that amount over to the IRS. Warren also had an obligation to file Form 941s, the Employer's Quarterly Federal Tax Return, but failed to file accurate returns with respect to each of those businesses.

Warren used a third-party payroll company for various payroll services, including the preparation of Forms 941. Despite receiving accurate Forms 941 from the payroll company, Warren consistently evaded his responsibilities to the IRS by deliberately and significantly underreporting the true value of the employment taxes due by filing Forms 941s that were different than those prepared by the payroll company, not paying over any employment taxes in some quarters, paying over only some of the employment taxes due in some quarters, or failing to report the employment taxes via Form 941 altogether in other quarters.

Over the course of four years, Warren failed to pay over $1.3 million in taxes to the IRS.

Rather than paying the amounts his businesses owed to the IRS, Warren used those withheld monies to fund his and his family's personal living expenses, which included travel to the Caribbean, golf club memberships, private basketball lessons, luxury clothing, and accessories.

Warren is scheduled to be sentenced on October 13. He faces a maximum penalty of 5 years in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.

Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Darrell J. Waldon, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation (IRS-CI), made the announcement after U.S. District Judge David J. Novak accepted the plea.

Assistant U.S. Attorneys Carla Jordan-Detamore and Thomas A. Garnett are prosecuting the case.