Crime & Safety
Man Sentenced for Failing to Pay Employment Withholding Taxes
Minnetonka business man Stephen Paul Clough was sentenced Monday for his actions as owner of Gamma Vacuum in Shakopee.
On Monday in St. Paul federal court, one of the former owners of Gamma Vacuum, located in Shakopee, was sentenced for failing to pay federal income and employment taxes withheld from workers.
United States District Court Judge Richard H. Kyle sentenced , of Minnetonka, to three years of probation, four months of community confinement and a $25,000 fine for one count of willful failure to pay over tax. Clough was charged on April 27 and pleaded guilty on May 7.
Between 2003 to 2010, Clough failed to pay the Internal Revenue Service (“IRS”) appropriate income and employment taxes withheld from the wages of the employees at the company. Clough was solely responsible for Gamma Vacuum’s bookkeeping, including the withholding and payment of payroll taxes. Instead of making those payments, he used the funds to pay company expenses. Gamma Vacuum manufactures pumps and related products. Clough’s criminal behavior resulted in a tax loss to the IRS of $944,134.29.
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This case was the result of an investigation by the IRS-Criminal Investigation Division. It was prosecuted by Assistant U.S. Attorney William J. Otteson.
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