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From CO District Attorney: Riordan A. Maynard, age 50 of Centennial, was found guilty of corruptly impeding the administration of tax laws, conspiracy to defraud the United States, conspiracy to steal or embezzle employee benefit plan and healthcare funds, and theft or embezzlement in connection with healthcare following a seven day jury trial before U.S. District Court Judge Christine M. Arguello, announced United States Attorney Jason R. Dunn, IRS Criminal Investigation Special Agent in Charge Steven Osborne and U.S. Department of Labor Employee Benefits Security Administration Regional Director Jim Purcell. The federal jury returned its verdict yesterday afternoon.
According to court records and evidence presented at trial, Maynard served as the Chief Executive Officer of two communications technology companies located in Denver, Colorado, Touchbase USA (TBUSA) and its successor company Touchbase Global Services, Inc. (TBGSI). TBGSI offered a 401(k) savings plan to the employees of both TBGSI and TBUSA. Maynard conspired with a co-conspirator to steal funds that employees had directed TBGSI to withhold from their paychecks for 401(k) plans, and ultimately stole over $60,000 of 401(k) withholdings and used them for other TBGSI expenses.
TBGSI also claimed to offer a healthcare benefit program to TBGSI employees. In 2017, TBGSI claimed to contribute $600 per month to each participant’s premiums. Participants were responsible for the remainder of the premium cost. TBGSI automatically deducted the participant contribution from each participant’s paycheck. TBGSI was responsible for forwarding the full premium to the health insurance carrier. Maynard was convicted of stealing over $50,000 in funds that employees had withheld from their paychecks for their health insurance plans. Maynard then failed to pay for health insurance coverage. By June 2017, TBGSI owed over $100,000 to the health insurance carrier, which then terminated coverage for the employees. Numerous employee healthcare claims were denied.
TBUSA and TBGSI were also required to pay payroll taxes to the IRS. From early 2012 through September 2017, Maynard corruptly impeded the IRS’s attempts to collect these taxes. Maynard closed TBUSA and reopened it as TBGSI to avoid paying more than $2.5 million in unpaid payroll taxes owed to the IRS. TBGSI then ran up an additional unpaid payroll tax liability of over $2 million. Maynard transferred funds from business accounts to Maynard’s personal account to avoid IRS levies. And he conspired with a co-conspirator to falsely tell TBGSI customers that IRS levies they had received were in error, in an effort to prevent customers from sending money to the IRS.
"We thank the jury for their service in this case and appreciate the care in which they sorted through each of the 26 counts and more than 400 exhibits," said United States Attorney Jason Dunn. "Economic crimes such as this are complicated, but thanks to the hard work of our law enforcement partners and our prosecutors, the result in this case will bring justice for the employees who were cheated of their benefits, as well as for the taxpayers."
"Today’s verdict is a win for the employees of the companies Mr. Maynard used to steal their money and a win for the United States government. Corporate executives like Mr. Maynard have a responsibility to withhold income taxes for their employees and then remit those taxes to the IRS. Actions like Mr. Maynard’s result in the loss of tax revenue to the United States government and the loss of future social security or Medicare benefits for the employees," stated IRS Criminal Investigation Special Agent in Charge Steven Osborne.
"The prosecution of theft and embezzlement from employee benefit plans supports the Department of Labor’s mission to protect the rights of America’s workers, including the right to receive benefits earned through employer sponsored retirement and health benefit plans," said Jim Purcell, Employee Benefits Security Administration’s Regional Director in Kansas City. "EBSA will continue to aggressively investigate such crimes on behalf of workers nationwide."
Corruptly impeding administration of tax laws carries a penalty of not more than three years imprisonment and a fine of not more than $250,000 fine or two times the gain or loss. Conspiracy to defraud the United States carries a penalty of not more than five years imprisonment and a fine of not more than $250,000. Conspiracy to steal or embezzle an employee benefit plan carries a penalty of not more than five years imprisonment and not more than a $250,000 fine. Theft or embezzlement in connection with healthcare carries a penalty of not more than 10 years imprisonment and not more than a $250,000 fine.
Maynard is scheduled to be sentenced on August 12, 2019.
This matter was investigated by the Department of Labor Office of Inspector General, the Internal Review Service Criminal Investigation, and the Department of Labor’s Employee Benefits Security Administration. This matter is being prosecuted by Assistant U.S. Attorneys Rebecca S. Weber and Aaron M. Teitelbaum.
The indictment contains certain charges against a co-conspirator, who has not yet been tried. As to the co-conspirator, the charges in the indictment remain allegations.
Case No. 18-cr-395