NORFOLK, Va. – A Virginia Beach woman pleaded guilty yesterday to failing to pay over to the Internal Revenue Service (IRS) payroll taxes that were deducted from her employees’ paychecks.
According to court documents, from at least 2011 to 2019, Wendy Brockenbrough, 53, failed to pay over to the IRS pay roll taxes from the three different companies she owned. As the principal owner, Brockenbrough was responsible for withholding the required employment taxes and paying that amount over to the IRS. She also had an obligation to file Form 941, Employer’s Quarterly Federal Tax Return but failed to do so for years with respect to each of these businesses.
The court records indicate that Brockenbrough issued her employees weekly paystubs and annual Form W-2s indicating that the appropriate payroll taxes were being withheld from her employees’ paychecks. While Brockenbrough withheld the taxes, she failed to pay over the amounts to the IRS. Instead, Brockenbrough lived a lavish lifestyle by purchasing a Regulator center console boat for approximately $126,000, a Hatteras 60-foot yacht for approximately $820,000, and a Jeep Wrangler for approximately $41,000. Brockenbrough attempted to conceal her actions by lying to her accountants and stating that she made the payments. To support her claims, she forged IRS records and Quickbook entries showing the taxes had been paid. Brockenbrough’s actions caused an approximate $2,721,268 loss in unpaid payroll taxes to the IRS.
Brockenbrough is scheduled to be sentenced on September 8. She faces a maximum penalty of 15 years in prison. 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, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation, made the announcement after U.S. Magistrate Judge Robert J. Krask took the plea.
Assistant U.S. Attorney Joseph Kosky is 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. 2:22-cr-46.