Little Rock , AR. — Andrew Thurman Melton, 67, of Pulaski County — a Certified Public Accountant and former Executive Vice President, Chief Financial Officer (CFO), and Treasurer for ThermoEnergy Corp. — today was indicted by a federal grand jury on 5 counts of failing to truthfully account for and pay over employment taxes to the IRS.
Melton previous was indicted on 12 counts of mail fraud.
The indictment was announced this afternoon by Christopher R. Thyer, U.S. Attorney for the Eastern District of Arkansas and Christopher A. Henry, Special Agent in Charge, Internal Revenue Service (IRS) Criminal Investigation, Nashville Field Office.
“Corporate Executives have a responsibility to withhold income taxes for their employees and then remit those taxes to the IRS,” Henry said. “The failure to pay over withheld taxes is a serious offense. IRS Criminal Investigation vigorously pursues anyone who collects taxes and fails to timely remit those taxes.”
The updated indictment charges that during the calendar years 2005 through 2009, ThermoEnergy withheld tax payments from its employees’ paychecks. However, beginning in approximately October 2005, ThermoEnergy made no payroll tax payments to the IRS and failed to file quarterly employment tax returns (Forms 941) with the IRS.
ThermoEnergy failed to account for and pay over approximately $1.9 million in payroll taxes. As the Executive Vice President, CFO, and Treasurer, Melton was responsible to collect, truthfully account for, and pay over ThermoEnergy’s payroll taxes. ThermoEnergy moved from Little Rock to Worcester, Mass., in 2011. ThermoEnergy is “a diversified technologies company engaged in the worldwide development, sales and commercialization of patented and/or proprietary industrial wastewater treatment and power generation technologies.”
The statutory penalty for Employment Tax Fraud is not more than 5 years’ and/or not more than a $250,000 fine with not more than 3 years supervised release.
According to the previous indictment, Melton’s wages were supposed to be garnished as a result of a Judgment against him personally. However, Melton allegedly caused checks to be issued from ThermoEnergy to pay the Judgment and expensed those payments on ThermoEnergy’s financials as if the payments were legitimate business expenses of the company. The indictment alleges that between, in or about August 2006 and April 2009, through this scheme, he obtained approximately $109,575.80.
Prior to that indictment Melton was a consultant for One Bank & Trust, currently under federal investigation.
The statutory penalty for Mail Fraud is not more than 20 years’ imprisonment and/or not more than a $250,000 fine with not more than three years of supervised release.
The investigation was conducted by the Federal Bureau of Investigation and IRS Criminal Investigation.
Thyer noted that an indictment is a form of accusation and is not evidence of guilt. The defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.