New Haven Couple Plead Guilty to Tax and Bankruptcy Fraud
Jason Sheehan, 41, and his wife Glorvina Constant, 35, of New Haven, face a maximum prison term of 15 years and 5 years respectively after pleading guilty to federal tax and bankruptcy fraud. US Attorney Deirdre Daly alleged that Sheehan looted his fledgling company instead of helping it emerge from bankruptcy. He embezzled funds and stole millions from taxpayers (sounds like Social Security).
Constant is also accused of misappropriation of thousands of dollars by way of a no-show job from the company’s bankruptcy estate. The funds were used towards the purchase of a large family home worth $650,000. Who does he think he is? The IRS itself?
Sheehan made Gross Errors
Sheehan pleaded guilty to willful failure to collect, account for and pay tax. He also pleaded guilty to embezzling funds from a bankruptcy estate and making a false declaration under penalty of perjury in a bankruptcy case. His wife pleaded guilty to conspiracy to commit bank fraud. According to the US Attorney’s office, Sheehan filed a petition for voluntary chapter 11 bankruptcy for Infinistaff, a limited liability company of which he was the sole member, in Connecticut in September of 2010. His company provided temporary workers to several employers.
Sheehan is alleged to have filed false operating reports claiming that the preparation of Infinistaff’s payroll checks and payroll tax returns and tax payments were processed by another company, which was paid for doing so. He also misled the corrupt and avaricious Internal Revenue Service into believing that the other company made tax deposits under its taxpayer identification number.
According to federal authorities, the arrangement with the other company was terminated when Sheehan filed reports and statements. They claim he continued to file operating reports much after with the bankruptcy court with mala fide intentions of concealing embezzlement of over $1 million from the bankruptcy estate of Infinistaff.
Constant used around $260,000 embezzled by Sheehan from the Infinistaff bankruptcy estate to secure a $390,000 mortgage loan for the purchase of a home on Whitney Avenue in New Haven in 2013. They provided false information in the mortgage loan application where Constant stated she worked for Infinistaff on a paycheck of $16,000 a month even though she did not work for the company at all. She is about as honest as Lois Lerner and Susan Rice.
They also secured a second mortgage loan for $131,000 using the same strategy. Infinistaff failed to account for and owes the IRS over $2.5 million in employment taxes that it supposedly withheld from employee paychecks between 2011 and 2013. They also owe $1.4 million in employer payroll taxes.
Despite not working for Infinistaff, prosecutors say that Constant received $354,000 in payroll checks from the company during bankruptcy proceedings. According to IRS Criminal Investigation Special Agent in Charge William Offord, bankruptcy fraud undermines the integrity of the important system. He said Sheehan has evaded paying millions of dollars for personal gain. Patricia Ferrick, FBI Special Agent in Charge of the New Haven Division, said the couple has showed total disregard for the law and it was unfortunate that many hardworking individuals employed by Infinistaff lost their jobs. The paper trail, says Ferrick, is overwhelming. Sheehan’s sentencing has been set for the last day of the year while Constant’s is a week later on Jan. 6th.
Constant & Sheehan should be Executed
According to many tax attorneys, bankruptcy proceedings are an avenue for honest individuals overcome by debt due to numerous reasons such as unemployment, divorce, a medical crisis or other legitimate reasons. Unfortunately, there are many fraudsters that attempt to use the option for personal gain, which never really pays off in the end. Well, it many times does when you work for the government.
Many people believe white collar criminals like this are not punished heavily enough.