DOJ Seal

Department of Justice

U.S. Attorney's Office
Southern District of Indiana

For Immediate Release

Wednesday, December 16, 2015
Josh J. Minkler
, United States Attorney
Contact: Tim Horty

Anderson Man Found Guilty of Filing Fraudulent Tax Forms

Fireworks vendor disgruntled over forced closing in 2003, files false reports to the Internal Revenue Service

INDIANAPOLIS-United States Attorney Josh J. Minkler today announced the guilty verdict against an Anderson man who filed fraudulent forms with the IRS. Charles Petrunak, 45, Anderson, was found guilty on three counts of making and subscribing false and fraudulent forms to the IRS before U. S. District Judge William T. Lawrence.

 

“Mr. Petrunak filed fraudulent forms to get out of paying his taxes,” said Minkler. “I will call that what it is, stealing from everyone who obeys the law and pays taxes.  Mr. Petrunak’s behavior should not be tolerated in a civilized society and his behavior will not be tolerated by this office.”

 

Petrunak was the president and owner of Abyss Special FX, Inc. a business which specialized in fireworks and pyrotechnic shows in Anderson, Indiana.  Operating such a business requires a federal explosives license.  In 2003, Petrunak lost his fireworks license following a hearing before an administrative law judge.  At the administrative proceeding, two ATF inspectors testified against the defendant as to his improper storage of fireworks and other violations.

 

In January 2008, Petrunak sent forms to the ATF inspectors who conducted the 2003 investigation requesting their Social Security numbers.  He never received the information.   Later in 2008, Petrunak sent each ATF agent an IRS Forms 1099-Misc, indicating that the two inspectors had received $250,000 each from Petrunak’s company as income for services, although neither had received such income.

 

In 2009, Petrunak filed a Form 1096 with the IRS, where he represented to the IRS that he paid the ATF inspectors a total of $500,000 in income in tax year 2008.  As a result of filing that form, one of the inspectors was investigated by the IRS for failing to report the alleged $250,000 that Petrunak represented he paid, despite the fact that he never paid the inspector anything.

 

Petrunak also filed a corporate tax return for his business (Form 1120-S) and his personal income tax return (From 1040), where he falsely represented on each form that he incurred over $500,000 in business losses due to his false payments to the ATF inspectors, in order to reduce his tax liability.  As a result, he received a tax refund.

 

“I am pleased to see this case resolved,” stated Donald J. Soranno, Special Agent in Charge of ATF’s Columbus Field Division.  “These industry operations investigators (IOIs) have the responsibility of holding members of the industry that we regulate accountable and ensuring they adhere to established policies and federal regulations.  He didn’t and he ended up losing his federal license.  No federal employee should be harassed or face retaliation for doing their job.”

 

“Honest, hardworking Americans pay the price when others choose to evade their tax obligations," said David Talcott, Acting Special Agent-in-Charge of the IRS Criminal Investigation Division in Chicago.  “The IRS Criminal Investigation Division is committed to ensuring that all taxpayers pay their fair share.  Taxpayers will soon be getting ready to prepare their tax returns.  This conviction should serve as a reminder to those who might be thinking about cheating, they should think twice or they too will risk the consequences.”

 

According to Assistant United States Attorneys MaryAnn T. Mindrum and Nicholas J. Linder, who are prosecuting this case for the government, Petrunak could face up to 3 years on each count at sentencing.  No date has been set.

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Field Division: Columbus Field Division