Old Saybrook Man Owes $4.7 Million in Back Taxes: Special Agent

Old Saybrook resident David Adams, 55, was arrested Thursday, April 14, on a federal criminal complaint that charges him with one count of filing a false tax return. The charge of filing a false tax return carries a maximum term of imprisonment of three years.

Adams appeared before U.S. Magistrate Judge Robert A. Richardson in Hartford and was released on a $500,000 bond secured by real property.

The complaint alleges that, on June 7, 2011, the Old Saybrook man sold his partnership interest in an online floral business and received $4,708,419.20, wired into his personal bank account as part of the net proceeds owed to him as a result of the sale.

"Although Adams told his accountant that he sold his partnership interest in 2011, Adams did not tell his accountant that he received $4,708,419.20," according to a written statement from Deirdre M. Daly, United States Attorney for the District of Connecticut, and Joel P. Garland, Special Agent in Charge of IRS Criminal Investigation in New England.

Adams's 2011 tax return allegedly did not include the $4,708,419.20 in income he received as a result of the sale and instead showed his total income and tax liability for 2011 as substantially less than what should have been reported.

The 2011 tax return also reflected that Adams had paid $220,000 in estimated tax payments during the year when, in fact, he paid only $100,000 in estimated tax payments for 2011, Daly said.

The complaint alleges that Adams made false statements on his tax returns for years 2002, 2009 and 2012. For example, on his 2012 tax return, he allegedly failed to report more than $1.3 million in cash he received into his personal bank account in that year. The complaint further alleges that he has an extensive history with IRS collections.

According to statements made in court, it is alleged that Adams owes approximately $4.7 million in back taxes, interest and penalties.

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