A businessman facing federal charges in New Hampshire is preparing to admit he willfully failed to file tax returns and pay nearly $14.8 million in business and personal income taxes over several years, according to court records.
Andrew Park, who co-founded a startup software business in 2014 and operated it from his homes in Hanover, N.H., and Bedford, N.H., is accused of deducting taxes from the paychecks of employees in several states but failing to forward those funds to the Internal Revenue Service. He’s also accused of failing to pay income taxes on his own salary.
Park and his attorney signed a plea agreement and have a plea hearing scheduled for July 22, according to records filed in the US District Court for the District of New Hampshire.
Park was CEO for CarNow, a tech company that serves car dealerships, from its founding until 2023. In that role, prosecutors said, Park was responsible for “all financial matters.”
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Despite knowing he was legally responsible for paying the company’s employment taxes to the IRS and despite receiving hundreds of notices from the company’s payroll processing service that such taxes were “due soon,” Park did not file corporate income tax returns from 2014 through 2021 and “deliberately avoided taking steps to determine” whether employees’ payroll taxes had actually been remitted to the government, according to prosecutors.
CarNow’s workforce grew from two employees in 2014 to 105 employees in 2020, according to records filed with the court by IRS investigators.
The company discovered in late 2021 that the federal payroll taxes had not been remitted, so fellow leaders took steps right away to correct the problem and submit the withholdings even before the government’s investigation was known, according to Lou Laste, a public relations consultant serving as CarNow’s media contact.
“All of the monies owed have been remitted to the government and the employees are not at risk,” Laste said.
Park has not been associated with CarNow in any capacity since his departure in April 2023, Laste said.
A federal judge granted a search warrant application in 2022 for IRS agents to review the contents of Park’s business email address, according to court records that were briefly unsealed then resealed last week.
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The application described Park as “the primary target of this investigation” and his wife, Eleanor Kyung, as “also a target.”
The application noted that Kyung had worked for years as a professor of business administration at Dartmouth College’s Tuck School of Business, then became a visiting scholar at the University of Pennsylvania’s Wharton School. Kyung went on to teach at another Ivy League institution, Cornell University’s S.C. Johnson College of Business, and she is now an associate professor in the marketing division at Babson College, according to her curriculum vitae.
Kyung, who isn’t facing any charges, did not respond to a request for comment about the case.
Park’s attorneys — Michael J. Connolly and Owen R. Graham of Hinckley, Allen & Snyder; and Lee H. Rubin and Glen A. Kopp of Mayer Brown — also did not respond to requests for comment.
While most of the unpaid taxes at issue in this case pertain to Park’s business dealings, nearly $435,000 pertain to the couple’s joint filings. Kyung’s employer, Dartmouth College, withheld taxes from her salary in tax years 2016 through 2020, but Park failed to do likewise for the roughly $250,000 per year he was transferring from the company’s bank account into his personal bank account, according to the plea agreement.
“In his household,” the agreement states, “the defendant was responsible for ensuring the filing of joint individual income tax returns for him and his spouse. … Every year between 2013 through 2020, the defendant’s and the defendant’s wife’s combined gross income exceeded the income filing requirement, requiring them to file a Form 1040 or other tax return. Although the defendant knew he was legally required to file a tax return for his wife and himself for each of these years, he did not do so.”
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Park faces up to five years in prison on one count and up to one year on another, plus up to three years of supervised release, according to the agreement. On top of the costs of repaying what he owes, with interest, Park faces up to $350,000 in fines. The agreement says prosecutors will recommend that Park be sentenced “at the bottom of the applicable advisory sentencing guidelines range” as determined by a judge.
Steven Porter can be reached at steven.porter@globe.com. Follow him @reporterporter.