A pair of California executives have pleaded guilty to failing to pay millions in employment taxes to the IRS. Instead, they bought season tickets to the NHL's San Jose Sharks and country club memberships.
According to the Department of Justice, Lalo Valdez and Matthew Olson operate a San Jose-based product development and health informatics company that offers clinical care and technology services to clients in healthcare and academia.
From Q1 2017 through the second quarter of 2021, Valdez and Olson allegedly withheld taxes from employee wages but didn't pay the IRS or report them on quarterly tax forms. During that time, according to LinkedIn, both worked for Stella Technology, which is based in Milpitas, a San Jose suburb. Stella specializes in healthcare technology services, primarily custom software development. According to their LinkedIn profiles, both Valdez and Olsen still work for Stella.
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From 2017 to 2021, both Valdez and Olson were responsible for Stella's operations, including managing the books, signing checks, and hiring and firing employees. Both were responsible for withholding Social Security, Medicare, and federal income taxes from employee wages and paying those funds to the government each quarter.
In a press release, the Justice Department stressed that the timely payment of quarterly employment taxes is critical to the U.S. government functioning—they are a primary source of funding.
During the same period referenced, Olson also owned a day spa in Saratoga and, from Q2 2017 through the fourth quarter of 2020, he collected but failed to pay or report employee taxes.
Olson caused a tax loss exceeding $2.1 million, and Valdez caused a total tax loss to the IRS of some $1.5 million.
Valdez and Olson are scheduled to be sentenced on Oct. 20. Both face a max penalty of five years in prison as well as supervised release, restitution, and other monetary penalties. We reached out to Stella Technology, but the company didn't immediately respond to our request for comment.
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X-TIMESTAMP-MAP=LOCAL:00:00:00.000,MPEGTS:0
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A pair of California executives have pleaded
guilty to failing to pay millions in employment
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taxes to the IRS.
Instead, They bought season tickets to the
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NHL's San Jose Sharks and country club
memberships.
00:14.859 --> 00:19.670
According to the Department of Justice, Lalo
Valdez and Matthew Olsson operate a San
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Jose-based product development and health
informatics company that offers clinical care
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and technology services to clients in
healthcare and academia.
00:28.780 --> 00:34.900
From Q1 2017 through the second quarter of 2021,
Valdez and Olson allegedly.
00:35.040 --> 00:41.069
Withheld taxes from employee wages but didn't
pay the IRS or report them on quarterly tax
00:41.069 --> 00:43.979
forms.
During that time, according to LinkedIn,
00:44.150 --> 00:47.790
both worked for Stella Technology, which is
based in Milpitas,
00:47.950 --> 00:49.150
a San Jose suburb.
00:49.389 --> 00:54.180
Stella specializes in healthcare technology
services, primarily custom software development.
00:54.419 --> 00:59.830
According to their LinkedIn profiles, both
Valdez and Olsen still work for Stella from
00:59.830 --> 01:03.830
2017 to.
In 2021, both were responsible for Stella's
01:03.830 --> 01:06.480
operations, including managing the books,
signing checks,
01:06.489 --> 01:08.569
and hiring and firing employees.
01:08.959 --> 01:12.269
Both were responsible for withholding Social
Security, Medicare,
01:12.440 --> 01:17.629
and federal income taxes from employee wages
and paying those funds to the government each
01:17.629 --> 01:20.389
quarter.
In a press release, the Justice Department
01:20.800 --> 01:25.519
stressed that the timely payment of quarterly
employment taxes is critical to the US
01:25.519 --> 01:26.680
government functioning.
01:27.129 --> 01:30.760
They are the primary source of funding.
During the same period referenced,
01:30.970 --> 01:37.169
Olson also owned a day spa in Saratoga and from
Q2 2017 through the fourth quarter of
01:37.169 --> 01:41.879
2020, he collected but failed to pay or report
employee taxes.
01:42.169 --> 01:44.220
Olson caused a tax loss exceeding 2%.
01:44.449 --> 01:50.980
$1 million and Valdez caused a tax loss to the
IRS of some $1.5 million.
01:51.150 --> 01:54.540
Valdez and Olsen are scheduled to be sentenced
on October 20th.
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Both face a max penalty of 5 years in prison,
as well as supervised release,
01:59.360 --> 02:01.940
restitution, and other monetary penalties.
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We reached out to Stella Technology, but the
company didn't immediately respond to our
02:06.629 --> 02:08.500
request for comment.
I'm David Manti.
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This is manufacturing now.
