Bethesda company chief, ex-officer plead guilty in theft of state taxes

February 05, 1992|By Ted Shelsby

The president and former chief financial officer of a Bethesda-based lumber distribution company have pleaded guilty to criminal charges involving the theft of more than $372,000 in sales and withholding taxes from the state of Maryland, the attorney general's office said yesterday.

Bruce Gordon, president of Structural Systems Inc., admitted guilt Monday in not turning over collected tax revenues to the state. Although the violation is a misdemeanor, the maximum penalty is five years' imprisonment and a $5,000 fine, said Norman L. Smith, the assistant attorney general who prosecuted the case.

Mr. Smith said that Scott H. Price, the company's former chief financial officer, pleaded guilty last week to a more serious felony charge of fraudulent misappropriation of fiduciary funds and willful failure to turn over Maryland sales taxes that had been collected.

Price faces up to 10 years' imprisonment and a fine of $5,000. He was dismissed from the company in August 1990, according to Stanley J. Reed, an attorney who represents Gordon and the company.

As part of a settlement reached Monday, Structural Systems agreed to pay the state $1.1 million in back taxes, interest and penalties.

The company's failure to make tax payments to the state began early in 1986 and continued into 1991, Mr. Smith said. Gordon is to be sentenced by Judge John J. Mitchell in Montgomery County Circuit Court Feb. 28. Price is scheduled for sentencing March 12.

"This was not their money," said Mr. Smith. "They were collecting it on behalf of the state."

The state charged that Gordon and Price profited from the stolen taxes by using the money to establish a new company, J & S Lumber, also in Bethesda. "Our accountants were able to trace that money directly from one account to another," Mr. Smith said.

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