Massachusetts business owner sentenced to prison for million dollar tax fraud scheme

 

Date: Jan. 6, 2025

Contact: newsroom@ci.irs.gov

BOSTON — A Hanson man was sentenced on Jan. 3, 2025, for a tax fraud scheme in which he willfully failed to pay employment taxes for his two businesses.

Kenneth Marston was sentenced by U.S. District Judge Indira Talwani to six months in prison, to be followed by 18 months of supervised release, with the first six months served on home detention. Marston was also ordered to pay $101,791 in restitution. In October 2024, Marston pleaded guilty to one count of failure to collect and pay over employment taxes.

From 2015 through 2018, Marston owned and operated two businesses: Bowmar Steel Industries, Inc., which engaged in steel fabrication, and Teleconstructors, Inc., which provided installation services on cellular phone towers. During that time, Marston falsely treated his employees as if they were independent contractors and, in turn, failed to withhold employment taxes on over $3.8 million in combined wages. As a result, Marston avoided reporting and paying $1 million in employment taxes owed to the Internal Revenue Service.

United States Attorney Joshua S. Levy and Thomas Demeo, Acting Special Agent in Charge of the Internal Revenue Service Criminal Investigation (IRS-CI) in Boston made the announcement. Assistant U.S. Attorney James R. Drabick of the Securities, Financial & Cyber Fraud Unit and Trial Attorney Mark McDonald of the Justice Department’s Tax Division prosecuted the case.

IRS-CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.