Remaining San Antonio Businessman Charged in Connection with $133 Million Real Dollar Loss Fraud and Tax Case Pleads Guilty
|U.S. Attorney’s Office January 16, 2014|
In San Antonio this morning, 61-year-old San Antonio businessman Larry W. Kimes pleaded guilty to his role in what is believed to be the largest real dollar loss fraud and tax related case ever prosecuted in the Western District of Texas, announced United States Attorney Robert Pitman, FBI Special Agent in Charge Armando Fernandez, and IRS-Criminal Investigation Special Agent in Charge Steve McCollough.
Appearing before United States Chief District Judge Fred Biery, Kimes, the manager of AccounTex Financial Services LLC, pleaded guilty to a Klein tax fraud conspiracy charge and a mail fraud conspiracy charge. Kimes admitted that between 2002 and 2008, he and other co-conspirators stole more than $133 million from the clients of a series of Professional Employer Organizations (PEOs) that he and co-defendant Charles Pircher operated. The PEOs controlled by Kimes and Pircher, which included Service Professionals, entered into staff leasing agreements with various client companies to manage the companies’ payroll and insurance programs. Kimes and co-conspirators diverted to their own use and benefit clients’ money that should have been paid for payroll taxes and insurance premiums.
Kimes faces up to 20 years in federal prison on the mail fraud conspiracy charge and up to five years in federal prison on the Klein tax fraud conspiracy charge. Kimes also agreed that full restitution in this case amounts to $133,401,713. Sentencing has yet to be scheduled.
“This guilty plea brings to justice the six perpetrators of a scheme that stole over $133 million from clients and taxpayers. The defendants, including Kimes, managed to conceal their crimes behind the complexity of the scheme. Through the hard work of FBI and IRS-CI agents and Tom McHugh in this office, the defendants’ crimes have been revealed and they will be held accountable,” stated United States Attorney Robert Pitman.
Kimes’ co-defendants—Pircher; John D. Walker, II; John Bean; Mike Solis; and, Pat Mire—are all scheduled to be sentenced on February 21, 2014, at 8:30 a.m. before Judge Biery.
This case was investigated by agents with the Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigation. Assistant United States Attorney Thomas J. McHugh is prosecuting this case on behalf of the government.