United States Attorney's Office District of Connecticut
Press Release

BRANFORD BUSINESS OWNERS PLEAD GUILTY TO IRS CHARGES

Kevin J. O'Connor, United States Attorney for the District of Connecticut, announced today that RUSSEL W. MAHLER, SR. age 77, of 14 Michele Lane, Madison, and his son, RUSSEL W. MAHLER, II, age 43, of 14 Conifer Drive, Branford, waived their right to indictment by a grand jury and pleaded guilty in federal court in New Haven today to Conspiracy to Impede and Impair the Lawful Functions of the Internal Revenue Service.

The MAHLERS admitted in Court that between 1994 and into 2001 they operated a chain of gasoline/convenience stores at several locations in Connecticut, under a parent holding corporation known as Epic Holding, in such a manner as to prevent the Internal Revenue Service from correctly assessing and collecting income and employment taxes. The MAHLERS acknowledged that, among other methods they employed to avoid various taxes, they paid many of their store employees at least partially in cash without deducting withholding and employment taxes from their wages; used shell corporations to avoid paying employment taxes due the IRS; used aliases and nominees in the conduct of their business affairs to conceal income and assets from the IRS; and either filed false personal tax returns or failed to file an appropriate return when due in order to underpay their own personal income taxes. The MAHLERS admitted that the tax loss to the Government due to their fraudulent activities totaled approximately $270,000.

The MAHLERS will be sentenced by United States District Judge Janet Bond Arterton on May 30, 2003, at which time they each face maximum sentences of five years imprisonment and a fine of up to $250,000.

The case was investigated by the Internal Revenue Service, Criminal Investigation, and is being prosecuted by Assistant United States Attorney Peter A. Clark.

CONTACT:

U.S. ATTORNEY'S OFFICE
Delcie Thibault
Public Information Office
(203)821-3722 Office
(203)627-1082 Cell