Superseding Indictment Charges Former Owners of Delaware Trucking Company with Alleged Failure to File Taxes and with Conducting a $1.8 Million Fraud

The Federal Bureau of Investigation (FBI) on March 29, 2012 released the following:

“WILMINGTON, DE—Charles M. Oberly, III, United States Attorney for the District of Delaware, announced today that a superseding indictment was handed down yesterday by the federal grand jury charging Donald L. Dutton, Sr. and Vicki R. Dutton, of Ellendale, Delaware, with one count of conspiracy to defraud the Internal Revenue Service (IRS) by failing to file individual and corporate tax returns (18 U.S.C. § 371) and four counts of willful failure to file tax returns (26 U.S.C. § 7203). The federal grand jury had previously charged the defendants on September 6, 2011 with one count of conspiracy to commit mail fraud (18 U.S.C. § 1349) and five counts of mail fraud (18 U.S.C. § 1341).

According to the superseding indictment, the defendants conspired to defraud the IRS by failing to report approximately $1.8 million in taxable income that they earned between 2005 and 2008 as the owners and operators of trucking companies in Georgetown, Delaware called Little D. Trucking Co. Inc. and D. Dutton Trucking Co. Inc. In particular, the defendants’ allegedly filed no individual tax returns (Form 1040s) and no corporate tax returns (Form 1120s) on behalf of Little D. Trucking Co. Inc. with the federal government during this timeframe.

To conceal the income generated by the trucking companies, the defendants allegedly directed office staff to prepare false spreadsheets that inflated their business deductions. For example, the superseding indictment lists personal expenses such as jewelry, clothing, and child support, which the defendants categorized as business expenses on these spreadsheets. The defendants allegedly presented these spreadsheets to their accountant for tax preparation purposes.

The superseding indictment further charges that, between 2005 and 2009, the defendants failed to report to the Internal Revenue Service wages paid to the 15-22 truck drivers and office staff employed by their trucking companies.

The superseding indictment added the tax-related charges to prior allegations of mail fraud conspiracy and mail fraud, which involved a $1.3 million scheme to defraud Allens Family Foods (Allens). Allens was a poultry processing company based in Seaford and Harbeson, Delaware that declared bankruptcy this past June due to financial woes largely unrelated to the alleged scheme. Dutton Trucking hauled loads for Allens as an outside vendor. The superseding indictment alleges that the defendants billed Allens for trucking loads that were not actually hauled by Dutton Trucking. The Duttons allegedly paid a former Allens dispatch clerk a substantial cash kickback for her assistance in the fraud.

If convicted of the pending charges, the defendants face up to 20 years in prison on each count of mail fraud and mail fraud conspiracy and up to five years in prison for the conspiracy to defraud the IRS, in addition to possible fines and restitution. The four counts of willful failure to file tax returns are misdemeanors, each punishable by up to one year in prison.

United States Attorney Oberly stated, “To function, our federal and state governments rely upon citizens’ truly reporting their income to the Internal Revenue Service. Our office will vigorously prosecute those who seek to thwart their civic duties by failing to file returns or pay their just share.”

“The license to run a business is not a license to avoid paying taxes,” said Acting SAC Akeia Conner, IRS-Criminal Investigation, Philadelphia Field Office. “Mr. and Mrs. Dutton’s alleged misconduct, hiding income and having their business pay their purely personal expenses, cheated all Americans, since we all have to pay our fair share for the government services and protections that we enjoy.”

The case is the result of an investigation conducted by the Seaford, Delaware Police Department; the Federal Bureau of Investigation; and Internal Revenue Service-Criminal Investigation. The prosecution is being handled by Assistant United States Attorneys Ilana Eisenstein and Jamie McCall, District of Delaware. For further information, please contact AUSA Eisenstein at 302-573-6082 or AUSA McCall at 302-573-6079.

The charges in the indictment are only allegations, and the defendants are presumed innocent until and unless proven guilty beyond a reasonable doubt.”

US v Donald Lee Dutton, Sr. and Vicki R Dutton – Federal Criminal Indictment

US v Donald Lee Dutton, Sr. and Vicki R Dutton – Federal Criminal Superseding Indictment

18 U.S.C. § 371

18 U.S.C. § 1341

18 U.S.C. § 1349

26 U.S.C. § 7203


Douglas McNabb – McNabb Associates, P.C.’s
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