GREENEVILLE, TN (WJHL) – A Johnson City man, who formerly served as vice president of a Bristol, Tenn. paint company, was sentenced Monday following his January conviction for filing false and fraudulent federal tax returns in an attempt to evade paying income tax.
According to a federal court news release, Judge J. Ronnie Greer sentenced Charles J. Rutherford, 44, to serve 18 months in prison.
Court documents said from 2006 to 2014, Rutherford embezzled around $1 million by paying his own personal expenses out of Woods Paint Company accounts while serving as vice president of the business.
According to the release, Rutherford was still obligated to report the embezzled money on his federal individual income tax returns even though the funds were stolen, but he failed to report the money for tax years 2008 through 2013.
Rutherford filed false and fraudulent returns and reportedly evaded paying over $200,000 in federal taxes.
Along with the 18-month sentence, Rutherford was also ordered to pay over $1.2 million in restitution to both Woods Paint Company and the Internal Revenue Service (IRS).
According to the release, Rutherford will also be prosecuted in state court for theft.
Sullivan County Office of the District Attorney General, City of Bristol Tennessee Police Department and the IRS-Criminal Investigations Division conducted to the investigation.
“The IRS enforce the nation’s tax laws, but also takes particular interest in cases where someone, for their own personal benefit, has taken what belonged to others,” Tracey D. Montano, special agent in charge of the IRS-Criminal Investigations Nashville Field Office, said. “No matter what the source of income, all income is taxable. The prosecution of individuals who intentionally conceal income and evade taxes is a vital element of the IRS’ enforcement strategy. We are pleased with the successful resolution of this investigation.”
Copyright 2016 WJHL. All rights reserved.