July 11, 2002

PRESS RELEASE

WALTHAM MAN PLEADS GUILTY TO FILING FALSE TAX RETURN

Boston, MA... A Waltham man pleaded guilty today in federal court to filing a false corporate tax return which included false expenses.

United States Attorney Michael J. Sullivan and Joseph A. Galasso, Special Agent in Charge of the U.S. Internal Revenue Service, Criminal Investigation, announced today that MARTIN J. HANLEY, age 51, of 115 Parkview Rd., Waltham, Massachusetts, pleaded guilty today before U.S. District Judge Rya W. Zobel to one count of filing a false tax return.

At today's plea hearing, the prosecutor told the Court that had the case proceeded to trial the Government's evidence would have proven that HANLEY is the owner of Hanley Moving and Storage which is located in Dedham. HANLEY and its prior owner had borrowed money from an operator of an illegal gambling business. At the bookmaker's request, and to help the bookmaker show evidence of legitimate income and for social security purposes, HANLEY paid the bookmaker out of the business's payroll account and issued tax documents to the bookmaker which falsely reflected that the bookmaker was being paid as a consultant for the business. HANLEY then claimed the false wage payments and other loan interest payments to the bookmaker on the business's federal income tax returns.

The prosecutor stated further that the evidence would have shown that after HANLEY repaid the bookmaker for the loans, the practice continued with the bookmaker giving HANLEY cash which HANLEY then paid back to the bookmaker using a business check.

According to the prosecutor, the evidence would have shown that the business's tax return for the year 1996, signed by HANLEY under penalties of perjury, falsely reflected the payment of $32,760 in wages to the bookmaker, and also claimed, falsely, an additional $49,440 in loan interest payments to the bookmaker as insurance expenses for the business. HANLEY filed false tax returns for Hanley Moving and Storage for the tax years 1997-99, each of which contained false expenses relating to the bookmaker and/or the bookmaker's wife being employees of the business and other loan payments to the bookmaker as business expenses, all of which HANLEY knew were false.
As a result of filing the false tax returns, HANLEY avoided paying approximately $15,732 for the tax year 1996, $15,972 for the tax year 1997, $8,648 for the tax year 1998, and $3,450 for the tax year 1999.

Judge Zobel scheduled the sentencing for October 15, 2002 at 2:00pm. HANLEY faces up to 3 years' imprisonment, to be followed by 1 year of supervised release, and a $250,000 fine.

The investigation is continuing.

The case was investigated by the U.S. Internal Revenue Service, Criminal Investigation. It is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard in Sullivan's Economic Crimes Unit.

Press Contact: Samantha Martin, (617) 748-3139