CEO
OF START-UP COMPANY SENTENCED TO 30 MONTHS IN PRISON FOR TAX EVASION
Failed to Report more than $1.1 Million of Income
OAKLAND - United
States Attorney Scott N. Schools announced that yesterday afternoon John
Frances Griffin was sentenced to 30 months in prison for his guilty plea
to two counts of tax evasion. These charges are the result of an investigation
by the Internal Revenue Service Criminal Investigation and the Federal
Bureau of Investigation.
John Frances Griffin,
43, of Orinda, California, was indicted by a federal grand jury on May
18, 2006, and charged with three counts of mail fraud. On November 30,
2006, a superseding indictment was returned charging Mr. Griffin with
two counts of tax evasion. On April 26, 2007, a second superseding indictment
charged Griffin with fifteen counts of mail fraud, one count of wire fraud,
and two counts of tax evasion. In the plea agreement, Mr. Griffin pled
guilty to both counts of tax evasion.
According to the
plea agreement, Mr. Griffin was the Chief Executive Officer of VaporTech,
Inc., a start-up company located in Livermore, California, involved in
the research and development of technology which converts fuel to hot
water, high quality steam, or superheated water vapor. As CEO, Mr. Griffin
recruited investors and ran the day-to-day operations of VaporTech. He
received a monthly salary and had possession of the corporate debit card
and bank account. Mr. Griffin also raised over $2.5 million from investors.
During the calendar years 2004 and 2005, Mr. Griffin received taxable
income in excess of $1,198,700 yet failed to file federal income tax returns.
Mr. Griffin admitted that he evaded the assessment and payment of his
income taxes by paying for personal items with cash, cashier's checks,
and the company's debit card. He also cashed his salary checks instead
of depositing them.
United States District
Judge Claudia Wilken ordered Mr. Griffin to pay $746,615.83 in restitution
to the victim Vapor Tech and to pay a $5,000 fine. Judge Wilken also ordered
Mr. Griffin to forfeit numerous items, including $75,000, expensive jewelry
including a $30,359 diamond ring and a $3,425 gold tennis bracelet, electronic
equipment, and thousands of dollars worth of clothing and wine.
Maureen Bessette
is the Assistant U.S. Attorney who is prosecuting the case with the assistance
of Cynthia Daniel. The prosecution is the result of an investigation conducted
by the Internal Revenue Service - Criminal Investigation (IRS-CI) and
the Federal Bureau of Investigation.
Further Information:
Case #: CR06-00365
A copy of this press release may be found on the U.S. Attorney's Office's
website at www.usdoj.gov/usao/can.
Electronic court
filings and further procedural and docket information are available at
https://ecf.cand.uscourts.gov/cgi-bin/login.pl.
Judges' calendars
with schedules for upcoming court hearings can be viewed on the court's
website at www.cand.uscourts.gov.
All press inquiries
to the U.S. Attorney's Office should be directed to Natalya LaBauve at
(415) 436-7055 or by email at Natalya.LaBauve@usdoj.gov.
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