Former tax official accused of defrauding health company out of $7M
BATON ROUGE - A former tax official at a Baton Rouge-based home health and hospice care company pleaded guilty to a wire fraud charge Thursday in connection with a scheme to defraud the company out of more than $7 million.
The Department of Justice reports 40-year-old Michael Pitts was responsible for corporate tax matters including the preparation of state and federal tax returns along with the payment of state income taxes in states where the company operated. Pitts was employed by the company, Amedisys, from 2005 to the summer of 2014.
The report says Pitts conducted a scheme to defraud the company from October 2006 through May 2014. As a part of the scheme, Pitts created two counterfeit companies, one named “Stonehenge Entertainment” and the other called “Evergreen Incentives" to sell false “tax credit transfer agreements” to Amedisys. Investigators found Pitts had opened bank accounts for each of his companies at separate banks.
Pitts then used his position to present the false tax credit transfer agreements to his supervisors for approval, misrepresenting them to be valid tax credits. He also purchased the false tax credit transfer agreements on behalf of Amedisys.
It was learned that Pitts made electronic bank transfers to divert funds from an Amedisys account to a JPMorgan Chase Bank to his accounts at Capital One Bank and Regions Bank for his personal use.
Between Oct. 3, 2006 and May 16, 2014, Pitts allegedly caused the company 21 wire transfers totaling $7,641,528 accounts he controlled for his personal use.
One count of wire fraud carries a sentence of 20 years behind bars and a $250,000 fine or twice the gross gain derived via the offense. He also must forfeit all of the $7 million in profit he turned during the scheme.
A date for Pitts’ sentencing has not been scheduled yet.
Desktop NewsClick to open Continuous News in a sidebar that updates in real-time.
Area restaurants participating in #25onthe25th to donate to families of fallen officers
BR Police Chief Carl Dabadie steps down
Broome proposes plan to improve transportation
EBR Metro Council caught off-guard by police chief's sudden exit
Homeowner says contractor forged her signature to get money