Former Ann Arbor business owners plead guilty to conspiring to commit tax fraud
The former owners of the Ann Arbor-based Ariel Computing Company pleaded guilty on Monday to one count each of conspiracy to defraud the United States.
Anthony Kumar Chaudhuri, 55, and Margaret Ann Chaudhuri, 60, were arraigned in 2011 on 11 counts of failing to pay employment taxes and one count each of conspiracy to defraud the United States and obstructing Internal Revenue Service laws.
According to a Department of Justice news release, the former Ann Arbor residents owned a hospital inventory control software company under the name of Ariel Computing and several other nominee names. The business was operated from multiple addresses in Ann Arbor and employed between three and 10 people.
Court documents report that between 1996 and 2008, the Chaudhuris withheld about $888,353 in employment taxes from Ariel Computing employees, but approximately $704,488 of the withheld taxes failed to be paid over to the IRS.
The 2011 indictment reports that W-2 forms were prepared for employees and falsely stated the taxes had been withheld and paid to the IRS.
Instead of paying Federal Insurance Contribution Act taxes, the Chaudhuris spent the money on “business expenses, employee salaries and personal expenses”, according to the 2011 indictment.
The Chaudhuris will face a maximum punishment of five years in prison and a $250,000 fine for the conspiracy charge. A sentencing date has not yet been set.
Chelsea Hoedl is an intern reporter for AnnArbor.com. She can be reached at email@example.com.