DOJ New Mexico US Attorney's Office Weekly Plea and Convictions Update September 15th, 2024

DOJ New Mexico US Attorney's Office Weekly Plea and Convictions Update September 15th, 2024Photo by2nd Life Media

An Albuquerque man was sentenced to 40 months in prison for devising and operating a tax evasion scheme and ordered to pay over $5.5 million in restitution per a release from the US Department of Justice.

There is no parole in the federal system.

According to court records, in January 2005, David Wellington and Stacy Underwood founded National Business Services, LLC in New Mexico, specializing in creating LLCs for clients seeking to "beat the IRS" by evading taxes. Wellington focused on marketing and client development, while Underwood managed corporate filings and bank accounts.

The company obtained Employer Identification Numbers (EINs) for clients and opened bank accounts under Underwood's sole signature authority. From 2005 to 2015, they created 192 LLCs and opened 114 bank accounts, with approximately $41.7 million deposited into accounts under Underwood’s control, representing concealed income.

One notable client, Jerry Shrock, had three LLCs formed by National Business Services while undergoing an IRS audit. Despite the audit, Shrock transferred his home into one of the LLCs to shield it from the government. Between 2011 and 2015, he deposited nearly $4.9 million into a bank account opened for one of his LLCs, concealing over $4.3 million in income without ever filing tax returns.

Stacy Underwood pleaded guilty to conspiracy to defraud the United States and remains on conditions of release pending sentencing, which has not been scheduled. Under the terms of her agreement, Underwood faces up to 5 years in prison followed by up to 3 years of supervised release.

Jerry Shrock pleaded guilty to conspiracy to defraud the United States and was sentenced to 5 years’ probation and ordered to pay $1,542,769.70 in taxes, interest, and penalties.

Upon his release from prison, Wellington will be subject to three years of supervised release and is prohibited from ever running any business advising clients or dealing with the IRS.

U.S. Attorney Alexander M.M. Uballez and Carissa Messick, Acting Special Agent in Charge, IRS Criminal Investigation, made the announcement today.

IRS Criminal Investigation investigated this case. Assistant United States Attorney Jeremy Peña is prosecuting the case.

An Albuquerque man was charged by federal prosecutors with sexual abuse of a minor per another release from the DoJ.

The indictment alleges that between January 2022 and May 2023, Joseph Arquero, 50, an enrolled member of Isleta Pueblo, engaged in or attempted to engage in a sexual act with a child that had not yet attained the age of 12 years.

Arquero will remain on conditions of release in the third-party custody of La Pasada Halfway House pending trial, which has not yet been scheduled.

If convicted, Arquero faces 30 years to life in prison.

U.S. Attorney Alexander M.M. Uballez and Raul Bujanda, Special Agent in Charge of the FBI Albuquerque Field Office, made the announcement today.

The FBI Albuquerque Field Office investigated this case with assistance from the Isleta Police Department. Assistant United States Attorney Meg Tomlinson is prosecuting the case.

View the Indictment

An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.