Former office administrator facing federal charges for defrauding her employer of more than $700,000, for fraudulently obtaining social security disability payments, and for tax evasion

 

Date: July 9, 2021

Contact: newsroom@ci.irs.gov

Baltimore, MD — A federal grand jury has returned an indictment charging Linda Pylant of Grasonville, Maryland, for the federal charges of wire fraud, aggravated identity theft, social security fraud, and tax evasion. The indictment was returned on May 19, 2021 and unsealed today upon Pylant's arrest and initial appearance in U.S. District Court in Baltimore.

The indictment was announced by Acting United States Attorney for the District of Maryland Jonathan F. Lenzner; Acting Special Agent in Charge Darrell J. Waldon of the Internal Revenue Service - Criminal Investigation (IRS-CI), Washington, D.C. Field Office; Acting Special Agent in Charge Rachel Byrd of the Federal Bureau of Investigation, Baltimore Field Office; and Special Agent in Charge Michael McGill of the Social Security Administration - Office of Inspector General (SSA OIG), Philadelphia Field Division.

According to the eight-count indictment, from 2012 to July 2020, Pylant worked as an office administrator at a trade association, where she was responsible for bookkeeping, making check deposits, and other accounting duties, among other things. The indictment alleges that from 2017 until 2020, Pylant obtained money intended for her employer, which she diverted for her own financial benefit.

Specifically, the indictment alleges that in October 2017, Pylant opened a bank account purportedly for her employer, without the employer's knowledge or consent. Pylant allegedly caused over $700,000 worth of checks intended for her employer to be deposited into the fraudulently opened account. The indictment alleges that Pylant was the sole signatory on the bank account and hid its existence from her employer by causing bank statements to be mailed to Pylant's home address. According to the indictment, Pylant used more than $75,000 of the diverted funds at a local bingo hall, spent over $100,000 for retail shopping, dining, and grocery expenditures, and withdrew more than $200,000 in cash.

The indictment further alleges that in August 2015, Pylant applied for Social Security Disability Insurance (SSDI) falsely stating that she was disabled and unable to work, even though she continued to work and earn income from her employment as administrator at the trade association. As detailed in the indictment, after the Social Security Administration approved her SSDI application, Pylant continued to work for her employer and since 2018 received and spent more than $125,000 in SSDI benefit payments to which she was not entitled.

According to the indictment, from November 2014 until July 2020, Pylant evaded reporting her taxable income by causing her employer to pay her through a non-existent entity, LPSR Inc. The indictment alleges that Pylant did not register LPSR with the State of Maryland nor the Internal Revenue Service, and caused her employer to fail to issue a 1099 IRS reporting form for LPSR. As detailed in the indictment, Pylant allegedly caused her employer to pay LPSR more than $100,000, which was not reported to the Internal Revenue Service. Pylant also allegedly made false statements to the SSA concerning her income and employment, including that her employment with the trade association had ended in May 2014. The indictment alleges that in February 2016, Pylant filed a voluntary petition for bankruptcy, which failed to list her taxable income from her employer. On March 14, 2016, Pylant allegedly made false statements in connection with her bankruptcy petition, claiming that she was disabled, had zero earned income, was not required to file any tax returns, and that her employment status had not changed since February 2016.

If convicted, Pylant faces a maximum sentence of 20 years in federal prison for each of five counts of wire fraud; a mandatory two years in prison, consecutive to any other sentence, for aggravated identity theft; and a maximum of five years in federal prison for social security fraud and for tax evasion. 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.

An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.

Acting United States Attorney Jonathan F. Lenzner commended the IRS-CI, the FBI, and the SSA OIG for their work in the investigation. Mr. Lenzner thanked Assistant U.S. Attorney Harry M. Gruber and Special Assistant U.S. Attorney Michael Davio, who are prosecuting the federal case.