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Wednesday, May 22, 2024

Fayetteville company CFO sentenced to prison for $25 million tax fraud

The chief financial officer and majority owner of a Fayetteville company has been sentenced to 18 months in prison and ordered to pay $4.6 million after it was discovered he paid himself nearly $25 million in unreported income from the business.

Christopher Scott Harrison, 56, of Fayetteville, was sentenced Friday to 18 months in prison, followed by one year of supervised release to include home confinement, for tax fraud.

Harrison “knowingly divert corporate proceeds to support his lifestyle by claiming fancy jewelry, such as a Rolex watch, a Cartier diamond necklace and a Tiffany bracelet were business expenses,” said U.S. Attorney Michael Easley in a statement.

According to the evidence summarized in court, Harrison became the CFO and majority owner of insurance and human resources benefits business Ebenconcepts.

Beginning at least as early as 2012, Harrison began spending company funds for his own benefit. He purchased a watch for approximately $145,000 and spent approximately $300,000 of company funds for a swimming pool at his residence.

As these expenses came to light, Harrison filed for Chapter 11 bankruptcy. During the bankruptcy proceedings, an accounting firm retained by the bankruptcy trustee discovered almost $25 million in personal expenditures attributable to Harrison reported as business expenses between tax years 2012 and 2018.

Harrison filed false personal returns, which failed to report the income, leading to almost $6 million in uncollected federal income taxes.

“The license to run a business is not a license to avoid paying taxes,” said Internal Revenue Service Criminal Investigation Assistant Special Agent in Charge Brian Thomas, of Charlotte’s field office, in a statement

Chris Roush
Chris Roush
Chris Roush is executive editor of Business North Carolina. He can be reached at croush@businessnc.com.

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