Date: February 21, 2020
PHILADELPHIA – Charlie Kien of King of Prussia, PA was sentenced to six months' imprisonment, three years' supervised release, and ordered to pay a $10,000 fine by United States District Court Judge Mark A. Kearney for multiple charges of tax fraud.
The defendant pleaded guilty in October 2019 to charges of failing to pay employment taxes and filing false tax returns in connection with the operation of his former Philadelphia-based labor leasing company, CK's Business Services. The company had contracts to provide temporary employees to two local businesses: a flag manufacturer and military bandage manufacturer. In preparing and filing IRS Form 941 for both of these contracts, Kien failed to account for the correct number of the company's employees and wages paid, and also failed to file IRS Form W-2 for the unclaimed employees.
Further, the defendant paid many of his employees in cash – failing to collect and pay employment taxes to the IRS. For the tax years 2010 through 2012, the total amount of lost employment tax (employer and employee) was approximately $565,872. Kien also filed false personal income tax returns: for tax years 2010 through 2012, he failed to pay approximately $474,059 in taxes.
The case was investigated by the Internal Revenue Service, Criminal Investigations Service, and is being prosecuted by Assistant United States Attorney Terri A. Marinari.