September 30, 2022
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Group home operator pleads guilty to Fed charges

By on September 13, 2022 0

SAN JOSE — A former owner of a South Bay group home pleaded guilty to federal fraud charges Tuesday, admitting in court that she embezzled more than $1.2 million by pocketing tax deductions of its workers.

Annie Corbett, 55, also admitted to spending public funds and grants meant to support foster families on her personal expenses, including her timeshare. The longtime Redwood City resident who records show also has a residence in Nebraska pleaded in United States Northern District Court in San Jose, according to the U.S. Attorney’s Office.

The counts to which she pleaded, one count of wire fraud and willful failure to pay employment taxes, carry maximum sentences of 20 years and five years in prison, respectively, and a fine of up to $250,000 for each count. Given that the case was resolved through a plea bargain, Corbett’s sentence is unlikely to approach these upper limits of sentencing.

His attorney declined to comment on the plea, which court documents show had been in the works since at least April.

The U.S. Attorney’s Office originally charged Corbett in October 2020 after an investigation found evidence of fraud while running Corbett Group Homes, Inc., which operated three homes in the San Jose area between 2011 and 2018 before closing the business.

Corbett told this news agency in a 2019 interview that she closed the homes after her company was denied a state license to run what are called short-term residential therapy programs. She said she and her staff, who number about 60 a year, worked for two years to meet the programs’ higher standards of care and service, and keep the homes running.

In that same interview, Corbett blamed a disgruntled former accountant for issues she was having with the state, saying the ex-employee tried to blackmail her after she was fired, then made false claims that derailed its licensing offer.

The conflict with the accountant coincides with the period in which Corbett now says she committed fraud. The U.S. Attorney’s Office press release on Corbett’s guilty plea states that she “admitted to deceiving her accountant and CPA” while pocketing payroll taxes that were supposed to go to the IRS.

According to the federal investigation – led by the FBI, the IRS Criminal Investigation and the US Department of Health and Human Services – Corbett accepted funds from federal and local governments and charities aimed at supporting children with families d home and spent hundreds of thousands of dollars. of this money on itself.

The U.S. Attorney’s Office said Corbett illegally misappropriated a total of more than $550,000 that was spent “for his personal enrichment, including making his own credit card payments, personal retail payments, and vacation timeshare payments”.

Corbett also admitted in her plea that between 2014 and 2017, she deliberately failed to pay $752,165 in payroll taxes, even though she always withheld the required tax amounts from her employees’ paychecks, according to the federal prosecutors.

Corbett allegedly embezzled unpaid taxes and public funds by deceiving his accountant and tax preparer. Billing documents filed in March say Corbett would provide them with copies of checks from the company’s bank account made out to the U.S. Treasury, then later “changed the name of the payee of the checks” and deposited the funds into a bank account. “concealed” separate. authorities say she used it for both business and personal expenses.

“In this way, Corbett gave the appearance that the taxes had been paid, but she deposited the funds in a bank account over which she had sole control,” the documents say.

Corbett is out of jail awaiting his sentencing hearing scheduled for January 31.

Editor Julia Prodis Sulek contributed to this report.