Date: December 14, 2023 Contact: newsroom@ci.irs.gov Charleston, WV — Brian E. Drake of Parkersburg pleaded guilty today to 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 and did not file corporate income tax returns for RCCD for tax years 2019, 2020, and 2021 to evade payment of corporate income taxes. Drake is scheduled to be sentenced on May 2, 2024 and faces a maximum penalty of five years in prison, three years of supervised release, and a $250,000 fine. Drake also owes restitution. The tax loss from Drake's conduct exceeds $646,819.87 United States Attorney Will Thompson made the announcement and commended the investigative work of the Internal Revenue Service Criminal Investigation (CI). United States District Judge Irene C. Berger presided over the hearing. Assistant United States Attorney Erik S. Goes is prosecuting the case. 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. 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.
