Rhode Island Man Convicted of Defrauding Investors and Tax Evasion | USAO-RI

PROVIDENCE – A West Warwick man who conducted a decade-long Ponzi scheme that left  some investors empty-handed and the Government seeking tax payments due to the Internal Revenue Service pleaded guilty this afternoon in federal court in Providence to wire fraud and tax evasion.

According to court documents, between 2008 and 2018, Thomas Huling, 58, orchestrated a scheme that raised approximately $14 million, and caused losses of more than $6 million to his victims.  Huling defrauded investors by promoting several investment projects, including high-yielding bond trading platforms; a car emissions reduction technology; and an online advertising and marketing company. He solicited funds for these investments by representing, among other things, that the money would be used for the particular project he was promoting, and that the investments would achieve substantial returns with little or no risk within a short period of time. To enhance his credibility and build trust, Huling incorporated religion, the possibility of charitable good works, and association with well-known individuals into his sales pitches.

In truth, and contrary to his promises, Huling diverted investor money to fund a lavish lifestyle that included high-end vehicles, membership and golf fees at multiple country clubs, gambling, clothing, restaurants, vacations and travel, as well as improvements to his residence. He created and used multiple shell companies; opened over 50 bank accounts; and he engaged in convoluted financial transactions between various accounts before ultimately using the funds personally. When investors contacted Huling with concern about the status of their investments, Huling lulled them with false excuses and promises, and at other times avoided their calls. To appease certain investors, Huling used money raised from new investors to pay off earlier investors.

According to court documents, at the same time that Huling was defrauding his investors, he was also committing tax evasion. Between 2009 and April 2018, Huling reported no taxable income, paid no income taxes, and for certain years filed false and fraudulent individual and corporate income tax returns. To further hide his income, Huling used nominee bank accounts, and paid for personal expenses using cash and corporate debit cards. He also manipulated the books and records of his companies to record sham loans, titled personal assets in the name of shell companies, and made false statements to IRS special agents as to his income, expenses, and business activities. 

Huling’s guilty plea is announced by United States Attorney Zachary A. Cunha and Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division.

Huling is scheduled to be sentenced on December 19, 2022, and faces a maximum penalty of twenty years in prison for committing wire fraud, and five years in prison for committing tax evasion. He also faces a period of supervised release, restitution, forfeiture, and other monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Assistant Chief John Kane of the Justice Department’s Tax Division and Assistant U.S. Attorney Sandra Hebert of the District of Rhode Island are prosecuting the case.

IRS-Criminal Investigation and Federal Bureau of Investigation investigated the matter.

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Author: Editor
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