A plumbing-business owner was found guilty on Thursday of filing false tax returns two years in a row as part of a multinational tax fraud scheme, an official said.
Scott Francis Creasia, one of the owners of Plumb Plumbing, will be sentenced in U.S. District Court in Tucson on Feb. 1 and faces three to four years in prison, said IRS Special Agent Brian Watson.
According to court documents, Creasia became involved in a tax-avoidance scheme in late 1997 or early 1998 that began when he purchased a set of 12 audiotapes called "Gateway to Financial Freedom."
After purchasing the tapes, Creasia began associating with a member of Anderson's Ark and Association, believed to be a multinational organization whose purpose was the promotion and implementation of tax-fraud schemes.
The group assisted Creasia in setting up two sham business entities, court documents say.
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First, he established a fake limited-liability corporation for Plumb Plumbing, which made it seem that Creasia was only 25 percent owner of the business, documents state.
For two years, 1998 and 1999, Creasia only reported 25 percent of the company's income, even though he was the sole owner at the time. In 2000, he began correctly reporting the business's income after he was contacted by the IRS.
Court documents state that Creasia also created a sham company, in which he was a 95 percent partner, to implement another tax scheme.
Creasia took out a $675,000 loan on the company's behalf and reportedly invested it in an entity called Mason Advertising to market and sell tax programs, court records state.
Creasia never met the co-signer on the loan, never received any money from it and never made any payments, documents said. For 1998, he declared a 95 percent loss on the $675,000 loan. As a result, Creasia obtained a fraudulent tax loss.
Plumb Plumbing is still operational. According to its Web site, it is now owned by Creasia and Steve Showalter.
