Date: May 17, 2024 Contact: newsroom@ci.irs.gov BOSTON — The former owner of a now-defunct luxury home building business in West Springfield pleaded guilty yesterday to conspiring to defraud the United States and creating false documents to help one of his clients obtain a mortgage. Kent Pecoy of San Marco, FL, previously of Wilbraham, pleaded guilty to two counts of conspiracy to defraud the United States and one count of making a false statement to a federally insured financial institution. U.S. District Court Judge Mark G. Mastroianni scheduled sentencing for Aug. 20, 2024. Kent Pecoy was previously indicted in December 2019 along with his son, Jason Pecoy, and Kevin M. Kennedy, the former owner of a golf management company, for allegedly conspiring to defraud the United States by concealing cash payments for the construction of Kennedy’s two homes in East Longmeadow and West Dennis. The defendants were later charged in a superseding indictment in January 2020. On April 24, 2024, Kennedy was sentenced to 13 months in prison after being convicted by a federal jury for conspiracy to defraud the United States and making a false statement to a federally insured financial institution. Jason Pecoy had pleaded not guilty and is pending trial. Kent Pecoy owned and operated Kent Pecoy & Sons, Construction Inc. (KPSC) – a West Springfield-based commercial and luxury home construction company – as well as Sturbridge Development, LLC (Sturbridge) and Legacy General Contractors, LLC (Legacy). KPSCI constructed two homes for Kennedy in East Longmeadow and West Dennis – for which Kennedy paid Kent Pecoy in cash. From 2009 through 2016, Pecoy conspired with others to conceal income from the IRS by dealing in cash. Specifically, Pecoy received $1,116,900 in cash payments from Kennedy for the purchase and construction of custom-built homes in East Longmeadow and on Cape Cod. Kent Pecoy failed to deposit most of the cash into business bank accounts, and instead distributed the cash directly to vendors and subcontractors. For the payments Kent Pecoy did deposit, he deposited the cash in amounts less than $10,000 to avoid the filing of currency transaction reports. Kent Pecoy also created and maintained separate ledgers documenting Kennedy’s cash payments, created and maintained false contracts and cover sheets and created false entries in KPSC’s accounting system to conceal the cash payments. Additionally, in January 2010, Kent Pecoy and Kennedy made false statements to Charles Schwab Bank on a loan to Kennedy and his wife for the construction of a residence in East Longmeadow in an attempt to conceal $160,000 cash down payment. These false statements included understating the sale price of the residence lot, the price of the construction and the deposit and earnest money paid by Kennedy. The charge of making a false statement to a federally insured financial institution provides for a sentence of up to 30 years in prison, five years of supervised release and a fine of $1 million. Sentences are imposed based upon the U.S. Sentencing Guidelines and other statutory factors. The conspiracy charges provide for a sentence of up to five years in prison, three years of supervised release and a fine of $250,000. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case. Acting United States Attorney Joshua S. Levy and Harry Chavis, Jr., Special Agent in Charge of the Internal Revenue Service Criminal Investigation (CI), Boston Field Office made the announcement today. Assistant U.S. Attorneys Steven H. Breslow and Neil L. Desroches of the Springfield Branch Office are prosecuting the case along with Trial Attorney Eric B. Powers of the Justice Department’s Tax Division. The details contained in the charging documents are allegations. The remaining defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. 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.
