Mississippi man admits hiding millions while avoiding federal tax collection efforts.
A Mississippi man has admitted using a series of financial moves to keep the federal government from collecting more than $2 million in unpaid income taxes. Eric Brian Rosenberg pleaded guilty in federal court to one count of tax evasion after prosecutors said he moved money around and kept funds out of reach after learning that an Internal Revenue Service collection officer was looking into his unpaid tax bill. Court records described a practice called “check churning,” which Rosenberg used in the four-year span between 2016 and 2020. Rather than leaving money sitting in his checking account, he would use the funds to buy cashier’s checks. He would then hold those checks instead of depositing them right away. When he needed cash, he would deposit a cashier’s check into his bank account, take out the amount he wanted, and then remove the remaining money by getting another cashier’s check. Prosecutors said the process allowed Rosenberg to keep money moving without leaving large amounts sitting in his regular bank account.
The financial activity became more involved after he learned that an IRS revenue officer was trying to collect the taxes he owed. According to court documents, Rosenberg later created a company and opened a bank account in the company’s name. Money was deposited into that account, which prosecutors described as a nominee account. He then continued using cashier’s checks as part of the same process.
The case also involved Rosenberg’s spending at casinos. Federal prosecutors said that between 2016 and 2021, he spent more than $1 million gambling. The casino spending took place during the same period in which he was taking steps to keep money away from tax collectors. Rosenberg entered his guilty plea rather than taking the case to trial, and his sentencing is scheduled for December 16th of this year. Rosenberg could receive up to five years in prison for the tax evasion charge.
The investigation was handled by Internal Revenue Service (IRS)’s Criminal Investigation, which examines suspected criminal violations of federal tax laws. Prosecutors from the Department of Justice’s Tax Section and the U.S. Attorney’s Office for the Southern District of Mississippi are handling the case. The case is part of the federal government’s wider work against financial crimes involving fraud and unpaid taxes. The DOJ has recently announced other federal cases involving alleged fraud, false tax filings and the movement of illegal proceeds.
The Rosenberg case shows how financial activity can become part of a criminal tax investigation when money is repeatedly moved in ways that prosecutors say are intended to keep it away from government collection efforts. In this case, prosecutors said the use of cashier’s checks, a company bank account and continued movement of funds were all part of efforts to avoid paying a large federal tax debt.
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Mississippi Man Pleads Guilty to Evading $2M in Taxes
Mississippi man pleads guilty to evading $2M in taxes, spent $1M gambling
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