Charges: New Lenox man avoided $1.5M in tax

April 13, 2010 11:51:18 AM PDT
The president and sole owner of a south suburban construction company faces federal charges for allegedly under-reporting his personal taxable income by nearly $2.5 million over four years.

Robert C. Blum, 57, was charged Tuesday with four counts of filing false federal individual tax returns and four counts of filing false corporate income tax returns.

The New Lenox resident runs Castle Contruction Corp., a general contractor with offices in Markham.

Between 2003 and 2006, Blum allegedly had Castle pay for personal expenses including the construction of his home and purchase and upkeep of his personal 37-foot yacht. He is accused of then reporting those payments as business expenses.

Blum allegedly also diverted other Castle funds to himself and did not report them as income.

Authorities allege that due to his under-reporting of Castle's net income by nearly $2 million, Blum failed to pay about $665,000 in federal taxes owed by the company.

Blum is also accused of failing to pay approximately $875,000 in federal taxes because of his failure to fully report his personal income.

Each count of filing false federal or individual corporate income tax returns carries a maximum penalty of three years in prison and a $250,000 fine.

Blum will appear in U.S. district court for arraignment at a later date.