Construction Business Owner Admits Tax Evasion, Owes $1.35M

Owner of Newark Construction Business Admits Tax Evasion and Failure to Collect and Pay Over Taxes.Photo byMorristown Minute

Alain Rodrigues Admits to Underreporting Income and Failing to Pay Over $1.3 Million in Taxes

NEW JERSEY - Alain Rodrigues, a 49-year-old Middlesex County resident and owner of a construction business in Old Bridge and Newark, New Jersey, has admitted to charges of tax evasion and failure to collect and pay over taxes. U.S. Attorney Philip R. Sellinger announced that Rodrigues entered his guilty plea on August 1, 2024, before U.S. District Judge Esther Salas in Newark federal court.

The charges stem from a scheme where Rodrigues, starting in 2017, manipulated financial transactions involving his construction company. According to court documents and statements made during the plea hearing, Rodrigues deposited only a part of his customer payments into the company's business bank account. He converted the remaining funds to cash and money orders, which he deposited into his account or used to pay employees in cash. This dual-channel handling of finances led to substantial underreporting of both personal and business incomes.

The underreported funds amounted to significant tax discrepancies. Rodrigues failed to declare approximately $554,873 in income taxes and did not collect or forward $793,139 in employment taxes, totaling around $1.35 million in tax liabilities.

As part of his plea agreement, Rodrigues has committed to paying restitution of $1.35 million to the government and will file amended tax returns to correct the underreported income. Tax evasion and failure to collect and pay taxes each carry a maximum sentence of five years in prison and fines up to $250,000.

The investigation was led by IRS-Criminal Investigation agents, directed by Special Agent in Charge Jenifer L. Piovesan. Rodrigues's sentencing is scheduled for December 19, 2024, when the full terms of his penalty will be determined. This case highlights the government's ongoing efforts to clamp down on tax evasion and ensure compliance with tax laws.

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