St. Croix radio magnate faces tax evasion charges
Published: April 24, 2014
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ST. CROIX - Jonathan Cohen, owner of JKC Communications, was casually dressed in khaki shorts and a faded orange T-shirt when deputy marshals escorted him before District Magistrate Judge George Cannon on Wednesday afternoon.
Cohen was advised of his rights on federal charges of willful failure to file tax returns, provide information or pay taxes over the course of seven years.
According to the criminal complaint and supporting affidavit filed in District Court by Internal Revenue Bureau special agent Janine Claxton, Cohen failed to file corporate and individual income tax returns between 2004 and 2010 on behalf of himself and his corporations - Radio 95; Clara Communications of the V.I.; and JKC Communications, which is the parent company of Isle 95, Sunny 99.5 FM, Mongoose 104.9FM, AM 970-WSTX and WSTX FM-100 radio stations.
"BIR records reflect that there were no individual or corporate income tax returns filed for or on behalf of Cohen or the corporations since 2001," the document stated.
According to the affidavit, Cohen, who is the sole owner of the corporations, had his tax returns prepared by his accountant, but he never filed them.
The documents show that he realized a gross income averaging $1.8 million annually between 2004 and 2010 and that Cohen's net taxable income for that same time period averaged $220,000. Based on his net taxable income from the corporation, his personal income tax returns resulted in him owing anywhere from $31,000 to $122,000 annually between 2004 and 2001, a total of just more than $373,000, according to court documents.
Claxton said based on her investigations, Cohen also failed to file Gross Receipts Tax returns for every year between 2004 and 2010, so the Internal Revenue Bureau was not aware of the Gross Receipts for Clara Communications, JKC Communications and Radio 95, the report stated.
As a result of the investigation, Claxton said she determined that the Gross Receipts Tax due for all the years combined equals more than $514,000.
After advising Cohen of his rights Wednesday, Cannon set bail at $50,000, and Cohen was allowed to post a property bond to satisfy the bail amount and secure his release from the custody of the U.S. Marshals Service.
In a joint statement issued Wednesday evening, V.I. Attorney General Vincent Frazer and IRB Director Claudette Watson Anderson said the arrest is one of many more to come from their agencies as a result of work being done by the Tax Collection Task Force, which they jointly head.
Frazer said the IRS assisted the Internal Revenue Bureau in the investigation and will continue to assist the V.I. Government in its upcoming cases against those accused of failing to pay their taxes.
"There are many individuals who continue to cheat the Virgin Islands government by failing to file and pay taxes, and the task force is putting together the pieces of the puzzle needed to bring these individuals to justice," Frazer said.
"For far too long, too many have been getting away with not filing or paying their fair share of taxes, and through the work of the task force it is our goal to bring these individuals to justice and collect any outstanding payments owed," he said.
Frazer said Cohen's arrest is just the beginning of the cases he expects to arise from the combined effort of the Tax Collection Task Force.
- Contact reporter Fiona Stokes at 714-9149 or email email@example.com.