April 30, 2013
Misty Volaski, firstname.lastname@example.org
Longtime Ojai resident, football coach and business owner Scott Titus will face a federal judge July 15 to be sentenced for failing to report to the Internal Revenue Service (IRS) almost $1.6 million he paid to workers in his painting company.
He pleaded guilty Monday to making a false quarterly federal tax return for the second quarter of 2008 for his business, Scott Titus Painting.
According to a plea agreement Titus signed with the United States Attorney’s Office for the Central District of California (USAO) earlier this year, Titus reported that he paid employees $22,195, when he actually paid them $215,774 — for a total of $193,579 in wages he paid employees but did not report. The agreement further states that Titus owes the IRS $666,748.40 for employment taxes he failed to pay between 2008 and 2010. The unreported wages during those years total $1,594,971.
“I paid my guys cash,” Titus said Tuesday. “The $1.5 million was paid out in full to my employees in cash. I did not pocket any of that money. It all went to them. I did not withhold anything from my employees for their taxes … I’ve run my business completely professionally, and with integrity — everything except how I paid my employees.”
Titus faces a maximum sentence of three years in prison, a $250,000 fine, and the repayment of the $666,748 he owes the IRS. However, those are just guidelines for the judge, said Linda Lowery, special agent and public information officer with the IRS criminal investigation office in Los Angeles. “The judge is not bound by those sentencing guidelines … (Titus’ sentence) is at the judge’s discretion.”
Several things are taken into consideration, such as the 35 letters written in Titus’ favor, which were submitted to the courts by Titus’ attorneys. Other considerations could include Titus’ previous criminal record, which he said is clear. “My lawyers feel confident that … I have a good shot, I’ve never had a criminal record, I’ve been forthright with them, haven’t denied or dodged anything,” Titus said. “I’m just at the mercy of the court. If I’m gonna’ go down, then I’m gonna’ go down doing it right. I’m not gonna’ fight. I was wrong.”
Titus said he received audit paperwork from the IRS in 2011. “When I got that letter, I gave them everything, I fully cooperated with them,” he said. “I’ve done everything they asked of me. I want to make it right. Ever since I got that letter, I’m trying to run my business right‚ I hired a bookkeeper, CPA, attorneys. I’ve surrounded myself with people to help me run my business right.”
Because he is now a convicted felon, Titus will lose his contractor’s license. He said he is closing down Scott Titus Painting, and has sold his business assets — “paint brushes, sprayers, all that stuff” — to son Randy and a niece, who will open Ojai Custom Paint, Inc. Scott Titus Painting employees, he said, will apply with Ojai Custom Paint, Inc.
Lowery said it was unknown whether the employees would face any charges. “Public record was silent as to the employees,” she said.
“I started my business right out of high school. I’ve never been an ‘office’ guy, never … I’m not dumb, it was just the paperwork that got me … I was going off coaching, working, doing my thing,” Titus said. “I was like one of many young contractors — never got a business degree. I’m just a working man. I never wronged a client. But I apologize to all my clients for letting them down in any way.”
Until he faces United States District Judge Stephen V. Wilson July 15, Titus said it’s a waiting game. “I am taking full responsibility. I’m not blaming anybody but myself, my lack of business sense,” he said. “My faith — this is a fate thing for me. It’s all for good, it’s all for me to be better.”