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Tax adviser found guilty of fraudulent return

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By The Staff

    MOUNT WASHINGTON - A long-time financial services adviser has been found guilty by a Bullitt Circuit jury.

    The panel found that Penny McLaughlin was guilty of falsely aiding or assisting someone in preparing a false tax return.

    The jury recommended a one-year sentence.

    During the three-day trial, the jury found that McLaughlin falsely help prepare a relative’s tax return by suggesting he place money into a trust fund. The $2,100 contribution to her daughter’s trust fund was not eligible for a tax deduction.

    The victim’s tax return was later amended but he did not receive the $2,100 back.

    During final sentencing on Friday, defense attorney Michael Hawkins asked that his client be allowed to serve her time on probation.

    Since the trial, he said she voluntarily closed down her financial services business, which had been in operation for 29 years.

    Although it was part of the bond that she not prepare any tax returns, Hawkins said McLaughlin opted to close her entire business and seek employment elsewhere.

    He admitted an earlier conviction in Franklin County Circuit Court dealt with a similar issue of taxes. That case resulted in McLaughlin serving diversion.

    With her being out of the tax business, Hawkins didn’t think she would be a candidate to re-offend.

    If probation would be denied, he asked that some type of alternative sentence be allowed.

    Circuit Judge Rodney Burress received a number of letters from family and friends in support of McLaughlin.

    McLaughlin asked Burress to consider that she opted to close down her business and get a job with State Farm Insurance.

    With a husband in poor health and a daughter in college, McLaughlin said she is needed by her family.

    Special prosecutor Brett Butler, however, said that the defendant had a similar experience in Franklin County. Probation would depreciate the seriousness of the crime against all the taxpayers.

    In making his ruling, Burress said that the defendant was first guilty of willful aid to file a fraudulent tax return and received a one-year sentence, which was diverted.

    While a separate case, Burress said it shows a misuse and abuse of the tax system. And he had heard no remorse from McLaughlin.

    On the other hand, a one-year prison sentence would make her eligible for parole in about 45 days.

    In the end, Burress said incarceration would be appropriate. He sentenced McLaughlin to 30 days in the county jail and the rest of the one-year sentence would be probated for five years.

    In addition, McLaughlin would have to serve 250 hours of community service during the five-year period.

    She would also be prohibited to work in a tax business in any way.

Burress refused a delayed reporting date and McLaughlin began her sentence immediately.

    Charges against her mother, Louise, were dismissed by Burress during the trial.