Starks admitted to stealing more than $300,000 from the Charleston-based organization

CHARLESTON, W.Va. – U.S. Attorney  Booth Goodwin announced today that a Charleston festival executive director  pleaded guilty in federal court to income tax fraud.  Deborah S. Starks, 55,  of Cross Lanes, W.Va., admitted that she filed a false tax return in connection  with an embezzlement scheme that drained more than $300,000 from MultiCultural  Festival of WV, Inc. (“MultiFest”), a Charleston-based non-profit organization.

U.S. Attorney Booth Goodwin said, "Ms. Starks  failed to report more than half a million dollars of income on her taxes. More  than $300,000 of that unreported income was stolen by her from the charity that  puts on Multifest each year.”

Goodwin continued, “Obviously $300,000 is a  substantial amount of money to any company, but it's especially significant to  a small business or charity.  That's why  my office has focused on investigating and prosecuting cases like these to  protect such organizations and to send a clear message that such conduct will  not be tolerated in this district."

Starks was the treasurer of MultiFest at the time of  the scheme.  MultiFest sponsors a music,  arts and crafts, and dance festival held annually in Charleston. As treasurer,  Starks was in charge of revenue and expenses for MultiFest and maintained the  organization’s bank accounts.   

Starks admitted that beginning in or about 2005 and  continuing until 2010, she embezzled approximately $306,000 from MultiFest. She  also admitted additional unreported taxable income of approximately  $200,000.  Starks further admitted that  she wrote personal checks to herself and to other people, withdrew cash in the  form of checks, and made ATM transactions from MultiFest bank accounts during  the scheme.  Starks also admitted that  the embezzled funds were used primarily to support her personal gambling activities. 

In addition to the embezzlement scheme, the  defendant admitted that she prepared, signed and filed a joint U.S. Individual  Income Tax Return for each of the calendar years 2005, 2006, 2007, 2008, 2009  and 2010 and did not report the embezzled funds as income. 

Starks has agreed to pay restitution to MultiFest in  the amount of $306,872.04 and the Internal Revenue Service (IRS) in the amount  of $128,626. 

Starks faces up to three years in prison and a  $250,000 fine when she is sentenced on April 2, 2013 by United States District  Judge John T. Cophenhaver, Jr.

This matter was investigated by the IRS. Assistant  United States Attorney Eumi L. Choi is handling the prosecution.

This case is being prosecuted as part of the United  States Attorney’s Office for the Southern District of West Virginia’s Small  Business Protection Initiative.  U.S.  Attorney Booth Goodwin announced the Small Business Protection Initiative in  November 2010.  Small Business Protection  is a key initiative of the U.S. Attorney’s Office for the Southern District of  West Virginia that focuses on the prosecution of individuals who defraud small  West Virginia businesses located in the Southern District.

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