Two former executives of a Blair County firm that bulk mails financial services marketing pitches were charged today with filing false tax returns, and at least one pleaded guilty.
Robert Paltrow, 72, of Palm Beach, Fla., and Michael Herman, of Hollidaysburg, whose age was not immediately available, both recently left Duncansville-based North American Communications in order to minimize damage to the company, according to Mr. Paltrow's attorney, Mark B. Sheppard.
On his 2007 tax return, Mr. Paltrow reported taxable income of $101,401, when he actually earned $3.1 million, an IRS Criminal Investigations probe found. For the following year, he claimed income of $94,137, versus actual earnings of nearly $1.9 million, according to the criminal charges.
Mr. Sheppard, of Philadelphia, said that the tax crime involved claiming personal spending as business expenses.
Mr. Paltrow, formerly the company's president, promptly pleaded guilty today, and faces sentencing Sept. 30, according to Mr. Sheppard.
“Mr. Paltrow has accepted responsibility for his actions," said Mr. Sheppard. "He has already paid 100 percent of the taxes due for those years, and will continue to do what he can to make this matter right. ... It was important to him that the business continue, and that the lives of [employees] were not impacted by his mistake.”
Mr. Herman, according to the criminal charges, reported a 2007 loss of nearly $2.9 million, when he actually had a positive income of $1.8 milllion. In 2008, he reported a loss of $3.6 million, versus actual positive earnings of nearly $1.6 million, the IRS found.
There was no attorney or plea listed on the U.S. District Court docket for Mr. Herman, who used to be the company's vice president.
Rich Lord: email@example.com or 412-263-1542. Twitter: @richelord.