Former Alaska City Treasurer Sentenced for Wire Fraud, Money Laundering and Tax Evasion

An Alaska man was sentenced yesterday to 30 months in prison for embezzling more than $1 million from the City of Houston, Alaska, and from a Wasilla-based equipment company, and then evading taxes on the embezzled profits.

According to court documents and statements made in court, from 2015 through 2018, Jess Adams was the Treasurer for the City of Houston, where he was entrusted with bookkeeping responsibilities and had administrative access to the city’s accounting records and software. Adams used this access to direct electronic transfers from the city’s bank account to a personal account in his name, which he maintained to hide the embezzled funds. Adams created fictitious entries in the city’s accounting records to disguise these payments as legitimate business expenses.

In October 2018, the City of Houston placed Adams on administrative leave, and he resigned his position in November 2018. A year later, Adams was employed as a bookkeeper by an equipment company, where he exercised control over the company’s accounting records and software. Using this access, Adams directed electronic transfers from the company’s bank account to other personal accounts that Adams opened in his name to hide the embezzled money. To conceal his activity, Adams used fictitious entries in the company’s accounting software to make it appear as though these funds were transferred for the payment of legitimate business expenses.

Adams then laundered the money he embezzled from the equipment company by making several wire transfers from his personal bank account to other accounts, each at a value greater than $10,000.

To further conceal his embezzlement and evade his taxes, Adams – a former seasonal tax return preparer for a national tax advisory company – filed false individual income tax returns for tax years 2016 through 2021. These returns did not disclose the additional income he embezzled.

In addition to his prison sentence, Adams was ordered to serve three years of supervised release and pay over $1.5 million in restitution to the United States, as well as additional restitution to the City of Houston and to the equipment company.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney S. Lane Tucker for the District of Alaska made the announcement.

IRS Criminal Investigation investigated the case, with substantial assistance from the Alaska State Troopers.

Trial Attorney Boris Bourget of the Tax Division and Assistant U.S. Attorney Tom Bradley for the District of Alaska prosecuted the case.

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Source: Justice.gov