NEWPORT NEWS, Va. — A Newport News man who ran a credit card processing business pleaded guilty to defrauding the IRS of $2.5 million in taxes Thursday.
Raj Parekh, the acting US Attorney for the Eastern District of Virginia, said 52-year-old Richard Yanek used those millions to buy an oceanfront home, pay yacht club dues and go on lavish vacations.
Parekh said Yanek did this by "hiding assets, making false statements about his ability to pay, using a nominee company to conduct business, and diverting huge sums of money to pay creditors instead of the IRS."
The release also said between 2013 and 2018, he withheld employment taxes from his workers, but didn't pay those withholdings to the Social Security program. Yanek allegedly gave his employees fraudulent tax forms to cover this up.
Between 2011 and 2015, Parekh said Yanek also had his personal tax returns prepared - showing that he owed lots of money to the government - and chose not to file those returns with the IRS.
Yanek hasn't been sentenced, but he faces a maximum charge of five years in prison.
Parekh said a judge will decide how long to sentence the Newport News man on September 27.