President of closed Falmouth poker chip company sentenced for tax evasion
John Kendall paid some employees off the books to divert the money intended for income tax to business and personal expenses.
A Falmouth man who paid the employees of his now-closed poker chip manufacturing company off the books and misused the money intended for income tax was sentenced on Friday to serve 10 months jail.
John Kendall, however, plans to appeal his conviction in the Cumberland County Courthouse in Portland, and Justice Thomas Warren granted his request that the sentenced be stayed while the appeal is pending.
The judge allowed Kendall, 66, the former president of Chipco International in Falmouth, to remain free on personal recognizance bail with a condition that he surrender his passport until the appeal is resolved.
“It’s not unusual for a defendant to request bail pending the outcome of an appeal,” said Assistant Attorney General Gregg Bernstein, who prosecuted the case.
Bernstein said he was pleased with the sentence, though he had requested Kendall serve a longer prison sentence of 18 to 24 months.
“It reflects the seriousness of the offenses, and it reflects the seriousness of the heightened role that he took in conspiring with other employees,” Bernstein said.
Kendall’s attorney, Thomas Hallett, could not be reached for comment Friday afternoon.
In total, Warren gave Kendall a 3 1/2 year sentence, with the bulk of the sentence suspended while Kendall serves a three-year probation term after his release. The judge ordered Kendall to pay $51,663 in restitution.
Kendall was found guilty on March 18 by a jury after a six-day trial of all charges against him – three felony counts of theft by misapplication of withholding taxes, one misdemeanor count of conspiracy to commit tax evasion, three misdemeanor counts of failure to account for or pay over withholding tax, and one misdemeanor count of making a false statement on a state income tax return.
Kendall withheld state and federal income taxes from employees’ wages from late 2007 to the end of 2012, diverting the funds to pay for business and personal expenses. He used the money for the mortgage of his Falmouth home, legal fees for his personal bankruptcy and for member dues and expenses at two country clubs among other expenses, the Attorney General’s office announced after Kendall’s conviction.
Kendall also conspired with one of his finance employees to withhold taxes from some management employees and underreported his own income in his 2009 Maine income tax return, according to the Attorney General’s office.
Six other former Chipco International employees had previously pleaded guilty to theft of unemployment benefits or tax evasion.
Much of the $165,000 in withheld Chipco employee taxes has been recovered. Maine Revenue Services recouped about $110,000, of which about $47,000 has been paid back through restitution by former employees.
