SANTA ANA, California – The owner of Orange County-based temporary staffing companies, who previously was charged with failing to pay more than $29 million in payroll taxes, was indicted today on six additional federal charges that he caused one of his companies to file false tax returns that failed to report an additional $29.6 million in payroll taxes.
Luis E. Perez, 52, who has maintained residences in Anaheim Hills, Yorba Linda, and Dove Canyon, was charged with six counts of aiding and assisting in the preparation of false tax returns. The charges carry an additional penalty for being offenses committed while Perez was free on bond after the initial tax evasion count was filed against him. Perez initially was charged in this case in early 2018 and a May 11 trial date is on calendar. His arraignment on today’s indictment is scheduled for April 5.
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Perez’s companies – which include Checkmates Staffing Inc.; Staffaid Inc.; BaronHR, LLC; BaronHR West Inc.; and Fortress Holding Group LLC – were required to withhold taxes from employee wages and to pay the withheld amounts to the IRS on a periodic basis. These withheld taxes, sometimes known as “trust fund taxes,” include income taxes and Federal Insurance Contributions Act (FICA) taxes that fund Social Security and Medicare. In additional, Perez’s companies, as employers, were required to pay matching FICA taxes imposed at the employer level. Collectively, trust fund taxes and employer FICA taxes are generally referred to as “payroll taxes.”
According to a second superseding indictment that a federal grand jury returned today, Perez caused the Anaheim-based temporary staffing company BaronHR West Inc. to substantially underreport employee wages and other compensation, which resulted in the company’s failure to report and pay $29,633,516 in payroll taxes to the IRS. From October 2018 to August 2019, Perez willfully aided and assisted in the preparation of false tax returns that substantially understated the wages paid to BaronHR West employees from January 2018 through June 2019, the indictment alleges.
Perez allegedly committed these crimes while charged with tax evasion. According to a previous indictment in this case that a federal grand jury returned in August 2019, for the tax years 2001, 2002, 2003, 2006, 2007, 2008 and 2010, Perez’s companies failed to pay the IRS the payroll taxes, including trust fund taxes that Perez’s companies withheld from employees’ paychecks. Beginning in June 2007, the IRS attempted to collect Perez’s outstanding tax liability, including penalties and interest. By February 2017, the outstanding balance had grown to $29,593,378, which included the unpaid taxes, interest and the “Trust Fund Recovery Penalty.”
Perez allegedly attempted to thwart the IRS’s collection efforts by purchasing luxury items – including numerous cars and a boat – and concealing his ownership by placing the titles of these items in the names of his businesses and other individuals. Those luxury items included a 2005 Ferrari 360 Spider F, a 2007 Rolls Royce Phantom, a Duffy D 22 Bay Island boat, a 2011 Mercedes-Benz SLS, a 2015 Mercedes-Benz G-Class, and a 2014 Lamborghini Aventador, according to the indictment.
As part of his efforts to impede the IRS, Perez allegedly made false statements to IRS revenue officers during interviews and failed to include material information in documents submitted to the IRS.