HUSBAND AND WIFE ARRAIGNED FOR $2 MILLION TAX EVASION AND INSURANCE FRAUD SCHEME

For Immediate Release
Case # 13CF1738






May 30, 2013

Susan Kang Schroeder
Chief of Staff
Office: 714-347-8408
Cell: 714-292-2718

Farrah Emami
Spokesperson
Office: 714-347-8405
Cell: 714-323-4486

HUSBAND AND WIFE ARRAIGNED FOR $2 MILLION TAX EVASION AND INSURANCE FRAUD SCHEME

SANTA ANA – A married couple was arraigned today for a $2 million tax evasion and insurance fraud scheme. Rand Robert Gordon, 59, Laguna Hills, is charged with five felony counts of misrepresenting facts to the State Compensation Insurance Fund (SCIF), one felony count of filing a false tax return, 10 felony counts of willful failure to file or make fraudulent tax return, one felony count of filing a false tax return, two felony counts of making fraudulent statements, two felony counts of making false statements to discourage injured worker from claiming benefits, 20 felony counts of failing to file a return with intent to evade tax, and 20 felony counts of willful failure to pay tax. Gordon faces sentencing enhancement allegations for committing a theft exceeding $100,000. If convicted, he faces a maximum sentence of 56 years and eight months in state prison. At the arraignment today, The People requested Gordon Rand be held on $2 million bail, but bail was set at $100,000 by the court, and the defendant must prove the money is from a legal and legitimate source before posting bond.

 

Co-defendant Michele Louise Gordon, 60, Laguna Hills, is charged with four felony counts of willful failure to file or make fraudulent tax returns and one felony count of filing a false tax return. If convicted, she faces a maximum sentence of five years and eight months in state prison. The court released Michele Rand on her own recognizance.

 

The defendants are scheduled for a pre-trial hearing June 27, 2013, at 9:00 a.m. in Department C-55, Central Justice Center, Santa Ana.

 

Circumstances of the Case

Rand and Michelle Gordon are accused of owning and operating moving service companies under the business names Gordon Moving Services Inc., Gordon Moving and Storage Inc., GMS Solutions, and various other names.

 

On Oct. 30, 2006, Rand Gordon is accused of obtaining an insurance policy for his company with SCIF. The defendant is accused of failing to make quarterly payments to SCIF and the policy was subsequently cancelled on Jan. 26, 2009. On March 26, 2009, Rand Gordon renewed his insurance policy with SCIF and obtained a different policy number. Rand Gordon is accused of knowingly making false and fraudulent statements by underreporting his payroll to SCIF and failing to pay taxes to the Employment Development Department (EDD).

 

Between January 2006 and December 2010, Rand Gordon is accused of underreporting $2.3 million to SCIF and $4.6 million to the EDD. The Gordons are accused of keeping the taxes meant to go to EDD, which becomes the defendants’ personal income. During that time period, the Gordons are also accused of failing to file tax returns or giving false information. The defendants are accused of owing $875,000 to SCIF, $586,000 to the Franchise Tax Board (FTB), and $508,000 to EDD.

 

On Jan. 9, 2008, Rand Gordon is accused of telling John Doe #1 to lie about an injury he suffered during a work assignment.