INDIANAPOLIS – Joseph H. Hogsett, United States Attorney, announced today the conviction and sentencing of Joseph Hinshaw, age 57, Westfield, Ind., for multiple counts of income tax evasion and fraud victimizing the financial aid programs of the United States Department of Education. “This office will not tolerate willful criminal violations of federal tax law, nor the theft of financial aid from public sources by those who don’t need the help,” stated Hogsett. Hinshaw pled guilty yesterday afternoon before United States District Judge Tanya Walton Pratt and was sentenced immediately thereafter.
From 2003 to 2007, Hinshaw operated telemarketing companies Circ Solution and Circ Pros. along with a partner located in Kansas City, Mo., who is now deceased. As an owner of these companies, Hinshaw controlled the payment of funds to other persons and himself.
The criminal investigation into Hinshaw’s activities began after the U.S. Department of Education learned that Hinshaw was submitting false claims for financial assistance. The investigation determined that Hinshaw’s claims contained false statements about his true income. Hinshaw submitted false financial aid forms, all of which reported little income. Criminal investigators from the Department of Education, Office of Inspector General, uncovered several personal and business bank accounts with significant cash flow, including one in the name of a elderly relative, who was not aware of the crime. As a result, Hinshaw fraudulently received financial assistance totaling $50,640. The Internal Revenue Service-Criminal Investigation Division later joined the investigation.
The IRS Special Agents determined that Hinshaw also had not properly reported his income to the Internal Revenue Service for many years. Hinshaw was able to defeat most of his income tax liability by concealing income in a bank account of his elderly relative from May 2003 to October 2007. During this time period, Hinshaw received personal income totaling $881,180 and evaded related income taxes of $298,746.
IRS Criminal Investigation Special Agent Al Patton stated, “tax evasion is not a victimless crime. Honest, hard working Americans pay the price when others choose to evade their tax obligation. The prosecution and sentencing of Mr. Hinshaw and other individuals who intentionally conceal income and evade taxes is a vital element in maintaining public confidence in our tax system. We should not expect the honest taxpayer to foot the bill for those who hide their income from the IRS.”
According to Assistant U.S. Attorney Steven D. DeBrota, who prosecuted the case for the government, Hinshaw was sentenced to 18 months of imprisonment and ordered to pay restitution to the U.S. Department of Education. He was also ordered to cooperate with the IRS in the assessment and payment of unpaid income taxes. He will have to serve three years of supervised release following his term of imprisonment.
When explaining the sentence, United States District Judge Tanya Walton Pratt stated the facts and circumstances of the case justified a sentence of imprisonment because Hinshaw long-standing and persistent criminal behavior involving multiple acts, thereby victimizing other taxpayers and potential recipients of student financial aid.