06-21-04 -- Haugabrook, Earl -- Indictment -- News Release

Former Irvington Official Indicted on Tax Fraud Charges

NEWARK - The former acting chief financial officer and director of finance for Irvington Township was indicted today for filing false federal income tax returns for 1995 through 1998, U.S. Attorney Christopher J. Christie announced.

The Indictment charges Earl Haugabrook, 53, of Essex County, a certified public accountant and longtime Irvington employee, with filing federal tax returns that were false in material respects for the tax years 1995, 1996, 1997 and 1998.

Haugabrook was not arrested by federal authorities. He is expected to be arraigned on the Indictment within the next two weeks before the U.S. District Judge in Newark to whom his case is assigned, according to Assistant U.S. Attorney James B. Nobile.

The charges state that Haugabrook, who had failed to file any of the tax returns until the middle of 2001, made materially false statements on the returns once he filed them. Among the materially false statements:

• Not reporting more than $4,800 in income that he had received in 1996 for his assistance in steering auditing contracts for the Irvington Township Department of Community Development and the City of Plainfield's Housing Authority to a particular contractor;

• Not reporting a $7,500 payment from an accounting firm in 1996 that Haugabrook received as a consultant in connection with the creation of Plainfield's Municipal Housing Authority;

• Not reporting at least approximately $54,000 in salary that he received from Essex County in 1995;

• Not reporting income that he received from his tax preparation and accounting business from 1995 through 1998; and

• Falsely claiming certain of his children as dependents from 1995 through 1998.

The Indictment charges Haugabrook with four counts of tax fraud, each of which carries a maximum penalty of three years in prison and a $250,000 fine.

Under U.S. Sentencing Guidelines, the Judge to whom this case is assigned would, upon conviction, determine the actual sentence based upon a formula that takes into account the severity and characteristics of the offense, and the defendant's criminal history, if any. Parole has been abolished in the federal system. Under the Sentencing Guidelines, defendants who are given custodial terms must serve nearly all that time.

Despite Indictment, every defendant is presumed innocent, unless and until found guilty beyond a reasonable doubt following a trial at which the defendant has all of the trial rights guaranteed by the U.S. Constitution and federal law.

Christie credited Special Agents of the IRS Criminal Investigation section in Springfield, under the direction of Special Agent in Charge Patricia J Haynes; and FBI Special Agents from the Newark Field Division, under the direction of Special Agent in Charge Joseph Billy Jr., for bringing the case against Haugabrook.

The government is represented by AUSA James B. Nobile, Chief of the U.S. Attorney's Special Prosecutions Division, in Newark.