Internet Communications Firm Owners Sentenced to Prison Terms
For Employment Tax Fraud and Failure to Pay Tax

     WASHINGTON - Frank G. Bivings and Isabelle Blanco, of Washington, D.C., husband and wife, and co-owners of The Bivings Group, Inc., were sentenced today to prison terms and ordered to perform community service and pay restitution on charges stemming from the failure to pay more than $2 million in employment taxes to the Internal Revenue Service.

     The sentencings, in the U.S. District Court for the District of Columbia, were announced by U.S. Attorney Ronald C. Machen Jr., Principal Deputy Assistant Attorney General John A. DiCicco of the Tax Division, and Jeannine A. Hammett, Acting Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation.

     Bivings pled guilty in July 2011 to one count of failure to pay over employment taxes. Blanco pled guilty in July 2011 to one count of failure to pay a tax. They were sentenced this morning by the Honorable Colleen Kollar-Kotelly.

     Bivings was sentenced to 30 months of incarceration. Upon completion of his prison term, he will be placed on three years of supervised release. He also will be required to perform 100 hours of community service.

     Blanco was sentenced to 10 months in prison. Upon completion of her prison term, she will be placed on a year of supervised release. She also will be required to perform 100 hours of community service.

     Under terms of their plea agreements, both defendants agreed to pay restitution of $2,420,927.

     The Bivings Group, Inc. was a full service Internet communications business. In pleading guilty, Bivings and Blanco both admitted that between January 1, 2002 and June 30, 2008, The Bivings Group, Inc. failed to pay over to the IRS a total of $2,420,927 in employment taxes, which includes withholding and FICA taxes. Of this amount, $1,813,488 represented the money that was withheld from employees for taxes but that was not paid over to the IRS.

     Instead of paying these payroll taxes to the IRS, the defendants used the funds to pay themselves substantial salaries and withdrew additional corporate funds for other expenses.

     In announcing the sentences, U.S. Attorney Machen, Principal Deputy Assistant Attorney General DiCicco and Acting Special Agent in Charge Hammett commended the investigatory work of IRS-Criminal Investigation Special Agent Michael Helgesen. They also praised the work of Assistant U.S. Attorney Susan B. Menzer and Tax Division Trial Attorney Tino Lisella, who investigated and prosecuted the case.

11-491

###