OAKLAND – LAWFUEL – The Law News Network – United States Attorney Kevin V. Ryan announced that Jack E. Easterday of Alameda, California, was convicted today by an Oakland jury of 47 counts of willful failure to truthfully account for and pay over payroll taxes owed to the government. The jury, after deliberating for two days, found that the defendant withheld income taxes and Social Security taxes from his employees but never paid them to the government. Easterday is the owner of numerous nursing home facilities in the East Bay. He was convicted today for his failure to pay over the payroll taxes owed by the following facilities:
Employee Equity Administration Inc,
Eden West Convalescent Hospital,
Homewood Care Center,
Oakland Care Center,
Sunrise Healthcare Center, and
Skilled Logic Systems, Inc.
The guilty verdict followed a three day jury trial before U.S. District Court Judge Claudia Wilkin.
Mr. Easterday, 51, was charged on March 11, 2005, with 47 counts of willfully failing to truthfully account for and pay over to the IRS the income taxes and Social Security taxes that he withheld from his employees. The criminal information charged Mr. Easterday with failing to pay over taxes of $3,008,311 from the years 1998 to 2002. Evidence at trial showed that the defendant failed to pay over $18 million in payroll taxes from 1998 to 2005, which will be considered for sentencing purposes.
The evidence at trial showed that the IRS had attempted to collect the taxes from the defendant for years before the charges were filed. However, the defendant thwarted the efforts of the IRS to collect the taxes by, among other things, paying himself and his wife exorbitant salaries and directors fees, while he was pleading poverty to the IRS collection agents.
The sentencing of Mr. Easterday is scheduled for May 15, 2006 before Judge Claudia Wilkin in Oakland. The maximum statutory penalty for each count in violation of 26 U.S.C.
Section 7202 is 5 years and a fine of $10,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Thomas Moore and Cynthia Stier are the Assistant U.S. Attorneys who prosecuted the case with the assistance of Kathy Tat. The prosecution is the result of a four-year investigation by the Internal Revenue Service.