NEWPORT NEWS, Va. – A federal jury convicted a Williamsburg man yesterday on charges of filing false tax returns and failure to file a tax return.
According to court records and evidence presented at trial, from at least 2014 through 2017, Michael J. Tiernan, 62, served as the financial officer for a number of business entities related to Ford’s Colony, including Ford’s Colony Realty, LLC, a large resort community in Williamsburg. For tax years 2015 and 2016, Tiernan filed federal income tax returns that falsely understated the income he received from these entities. Although the defendant reported some earnings in both years, he offset his claimed income with high deductions that resulted in zero taxable income for both 2015 and 2016, and also claimed to be insolvent in order to exclude the discharge of debt in 2015.
The evidence at trial revealed that Tiernan received underreported income from the business entities in the amount of at least $289,401 in 2015 and at least $204,523 in 2016. He cashed many of the checks he wrote and received from these entities and deposited cash into his personal bank account. Additionally, Teirnan failed to file a tax return for 2017, despite receiving $111,352 from one business. From 2015 to 2017, he deposited over $1.6 million into his personal bank account and spent nearly all of these funds in a combination of checks and debit card transactions. Teirnan further prepared and filed business tax returns for the entities that concealed the true compensation that he received.
Tiernan was convicted of filing false income tax returns and failing to file an income tax return and faces a maximum penalty of seven years in prison when sentenced on March 2, 2022. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia, and Darrell J. Waldon, Acting Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation, made the announcement after U.S. District Judge Raymond A. Jackson accepted the verdict.
Assistant U.S. Attorneys Brian J. Samuels and David Mack Coleman are prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:20-cr-59.
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