Matthew Daniels, 46, filed false tax returns for 2007 and 2008, according to U.S. Attorney Patrick A. Miles Jr.
“In particular, Daniels under-reported his gross receipts on his Schedule C for both 2007 and 2008,” Miles said. “The 2008 tax return that Daniels filed was a fraudulent income tax return which under-reported gross receipts by $362,489."
Daniels is a former Farm Bureau Insurance agent. However, the conviction is not related to his work as an insurance agent, emphasized Assistant U.S. District Attorney Matt Borgula.
At Daniels' sentencing in federal court in Grand Rapids on Tuesday, Judge Robert Holmes Bell said the Grand Haven man would be held responsible for under-reported gross receipts and taxes owed to the Internal Revenue Service totaling $119,003.
“Cheating on your taxes is the same as stealing,” said Erick Martinez, a criminal investigation special agent for the IRS. “We should not expect the honest taxpayer to foot the bill for those who hide income from the IRS.”
Once he serves his prison term, Daniels will be under a year of supervised release, similar to probation, Borgula said.
Download the RELATED FILES (PDFs) below this story to read the plea agreement and release from the U.S. Department of Justice on Daniels' sentencing.
Daniels formerly ran the Farm Bureau Insurance office at 132 Washington Ave. in downtown Grand Haven. A woman who answered the phone at the office this week said a different agent works there now. She said Daniels has been gone “not that long.”
Borgula said the federal charges evolved out of an investigation into a fraudulent investment scheme organized in part by a Byron Center man, James Wiederhold, who is currently serving a six-year term in a federal prison.
Wiederhold’s father, Neal Wiederhold, and uncle, Larry Niewenhuis, were also charged in connection with the scheme.
James Wiederhold operated the Atlas Fund investment company.
According to court documents, invested money was cashed out to one of the family members, while a small portion of it was sent out as interest payments to the investors.
The plea agreement noted that Daniels would cooperate in the investigation. In exchange, there would be no additional charges regarding tax years 2004 to 2008.
“We’ve agreed not to charge him with bankruptcy fraud,” Borgula said. “We’re not going to bring charges against his wife.”
Borgula said because Daniels cooperated and was not considered a flight risk, he is not currently in jail.
“He’s still out and about,” Borgula said. “He will get a notification about when to report (to prison).”