Four Sentenced for Roles in Defrauding the United States

From the U.S. Attorney’s Office, Western District of Virginia:

Abingdon, VIRGINIA – A pair of former employees of Kennedy Industrial Electronics, and their wives, were sentenced this week after previously pleading guilty to defrauding the United States as part of a disability benefits and payroll scheme that dates back at least 15 years, United States Attorney Thomas T. Cullen announced.

“Social Security and employment-tax schemes are serious federal crimes and ones that the U.S. Attorney’s Office and its federal, state, and local partners have made investigating a priority,” U.S. Attorney Cullen stated today.  “Small business owners are required to play by the rules in accounting for their employees, and risk serious consequences when they try to get around these requirements.”

Wednesday in U.S. District Court in Abingdon, Gerald Lee Stevens, 45, of Lebanon, Va., was sentenced to five months incarceration. In July 2019, Stevens pleaded guilty to one count of conspiracy to defraud the United States. Also Wednesday, Teena Charlene Stevens, 47, was sentenced to two years’ probation. She previously pleaded guilty to one count of causing to be made a false representation concerning the requirements of the Social Security Act. 

Earlier this week, Danny M. Hill, 70, of Lebanon, Va., was sentenced to eight months incarceration. Hill previously pleaded guilty to one count of conspiracy to defraud the United States. Also this week, Geneva Hill, 64, was sentenced to two years’ probation. She previously pleaded guilty to one count of causing to be made a false representation concerning the requirements of the Social Security Act.

Danny and Geneva Hill were ordered to pay $351,239 in joint and several restitution to the Social Security Administration, while Gerald and Teena Stevens were ordered to pay $309,217 in joint and several restitution to the Social Security Administration.  Co-defendants Harold Kennedy and Hollie Kennedy will be sentenced in the near future.  

According to court documents, between 2001 and 2015 the defendants conspired to defraud the United States through a scheme in which Harold and Hollie Kennedy, the owners of Kennedy Industrial Electronics, failed to report approximately $148,000 in employment taxes. Those taxes were owed through hours worked by employees Danny Hill, Gerald Stevens, and Ricky Matney.

However, Danny Hill, Gerald Stevens, and Ricky Matney were each receiving disability benefits from the Social Security Administration and therefore unable to earn additional income without reporting. As a result, the conspirators issued checks to their spouses, Geneva Hill and Teena Stevens, and others.

The investigation of the case was conducted by the Internal Revenue Service (Criminal Investigations), the Social Security Administration Office of Inspector General, and the Russell County Sheriff’s Office.  Assistant United States Attorney Lena Busscher is prosecuting the case for the United States.

Abingdon, VIRGINIA – A pair of former employees of Kennedy Industrial Electronics, and their wives, were sentenced this week after previously pleading guilty to defrauding the United States as part of a disability benefits and payroll scheme that dates back at least 15 years, United States Attorney Thomas T. Cullen announced.

“Social Security and employment-tax schemes are serious federal crimes and ones that the U.S. Attorney’s Office and its federal, state, and local partners have made investigating a priority,” U.S. Attorney Cullen stated today.  “Small business owners are required to play by the rules in accounting for their employees, and risk serious consequences when they try to get around these requirements.”

Wednesday in U.S. District Court in Abingdon, Gerald Lee Stevens, 45, of Lebanon, Va., was sentenced to five months incarceration. In July 2019, Stevens pleaded guilty to one count of conspiracy to defraud the United States. Also Wednesday, Teena Charlene Stevens, 47, was sentenced to two years’ probation. She previously pleaded guilty to one count of causing to be made a false representation concerning the requirements of the Social Security Act. 

Earlier this week, Danny M. Hill, 70, of Lebanon, Va., was sentenced to eight months incarceration. Hill previously pleaded guilty to one count of conspiracy to defraud the United States. Also this week, Geneva Hill, 64, was sentenced to two years’ probation. She previously pleaded guilty to one count of causing to be made a false representation concerning the requirements of the Social Security Act.

Danny and Geneva Hill were ordered to pay $351,239 in joint and several restitution to the Social Security Administration, while Gerald and Teena Stevens were ordered to pay $309,217 in joint and several restitution to the Social Security Administration.  Co-defendants Harold Kennedy and Hollie Kennedy will be sentenced in the near future.  

According to court documents, between 2001 and 2015 the defendants conspired to defraud the United States through a scheme in which Harold and Hollie Kennedy, the owners of Kennedy Industrial Electronics, failed to report approximately $148,000 in employment taxes. Those taxes were owed through hours worked by employees Danny Hill, Gerald Stevens, and Ricky Matney.

However, Danny Hill, Gerald Stevens, and Ricky Matney were each receiving disability benefits from the Social Security Administration and therefore unable to earn additional income without reporting. As a result, the conspirators issued checks to their spouses, Geneva Hill and Teena Stevens, and others.

The investigation of the case was conducted by the Internal Revenue Service (Criminal Investigations), the Social Security Administration Office of Inspector General, and the Russell County Sheriff’s Office.  Assistant United States Attorney Lena Busscher is prosecuting the case for the United States.