The former head of Tyco International’s tax department is headed to prison for tax evasion.
Raymond Stevenson was sentenced to three years in prison after pleading guilty to intentionally failing to report more than $170 million in income on Tyco’s 1999 corporate tax return, which would have resulted in an additional tax liability of $50 million to $60 million, according to an announcement
from U.S. Attorney for the Southern District of Florida R. Alexander Acosta.
Stevenson was Tyco’s top tax adviser and served as Tyco’s vice president in charge of taxation, where his responsibilities included overseeing the preparation and filing of Tyco’s corporate tax returns. He served under former Tyco International Ltd. chairman and chief executive officer Dennis Kozlowski and former chief financial officer Mark Swartz, both of whom were found were found guilty of grand larceny, securities fraud, conspiracy, and falsifying business records in June 2005.
According to Acosta, Stevenson directed a series of transactions designed to reduce Tyco’s state tax liability. Those transactions resulted in a $170 million capital gain that should have been reported in Tyco’s federal taxes. Stevenson was accused of ordering that documents relating to the transactions be backdated to avoid having to report the gain on Tyco’s federal tax return.
“Today’s prison sentence is a reminder that tax laws apply equally to everyone,” said Acosta, in a statement.
“Whether a complex corporate return or a straightforward individual return, if you prepare it or sign it, you are responsible for its contents and will be held accountable for any scheme to defraud the government,” added Brian Wimpling, special agent in charge of the Internal Revenue Service’s criminal investigation department, in the statement.
Stevenson was also fined $250,000 and must serve one year of supervision upon his release, according to the Palm Beach Post.
Stevenson had agreed to a plea agreement in September, according to Reuters.