Defendant ordered to pay $2,036,141.59 in restitution Date: July 25, 2024 Contact: newsroom@ci.irs.gov Brian E. Drake, of Parkersburg, was sentenced today to two years in prison, to be followed by three years of supervised release, and ordered to pay $2,036,141.59 in restitution for tax evasion. Drake admitted to evading payroll and corporate income taxes while the owner and operator of River City Chem Dry (RCCD). According to court documents and statements made in court, from at least 2008 and continuing through 2021, Drake owned and operated RCCD, which provided general building and specialty contracting services throughout West Virginia. Drake admitted that as an employer, he had a legal responsibility to collect and pay over to the IRS payroll taxes withheld from his employees’ wages and complete and file IRS Form 941. Drake further admitted that he knew that after he reorganized RCCD as a C corporation in 2012, he was required to pay corporate income taxes on earned income and complete and file IRS Form 1120 on behalf of RCCD every year. Beginning no later than 2005, Drake amassed a significant tax debt due to unpaid personal income taxes. Drake admitted that while his tax problems began as personal in nature, they later extended to RCCD. Drake’s tax delinquencies grew exponentially from 2005 through 2016, despite IRS attempts to collect his outstanding balances and work with him to help him attain compliance. Drake admitted that he willfully evaded payment of $299,765 in payroll taxes, including federal taxes and the employer-due portion of Social Security and Medicare, for reported wages paid to RCCD employees from at least 2016 through 2019. Drake further admitted that he evaded the assessment of $347,054.87 in payroll taxes by routinely paying RCCD employees substantially in cash from at least 2017 and continuing through 2021. Employees would receive paychecks reflecting a portion of their hourly wages and withheld taxes each payday along with envelopes containing cash for the hours they worked for which no federal taxes were withheld or paid over to the IRS. Drake also admitted that he failed to report money earned by RCCD for tax year 2016 and continuing through tax year 2021. Drake further admitted that he did not file corporate income tax returns for RCCD for tax years 2019, 2020, and 2021 to evade payment of corporate income taxes. The $2,036,141.59 in court-ordered restitution reflects Drake’s unpaid taxes, interest, and penalties. “The defendant has a long and repeated history of failing to pay personal and business taxes that has persisted from 2005 until now,” said United States Attorney Will Thompson. “The transferring of assets and attempts to conceal income show that his actions were not a series of neglectful mistakes, but willful, intentional, and deliberate conduct. I commend the Internal Revenue Service (IRS) for their investigative work in this case.” "This is precisely the type of conduct IRS Criminal Investigation and our law enforcement partners are committed to deterring," said Kareem Carter, Executive Special Agent in Charge of the Internal Revenue Service - Criminal Investigation (CI), Washington, D.C. Field Office. Today’s sentencing sends a clear message that we are committed to protecting the integrity of our tax system and holding those accountable who deliberately circumvent Unites States tax laws." United States District Judge Irene C. Berger imposed the sentence. Assistant United States Attorneys Erik S. Goes and Ryan Blackwell prosecuted the case.
