MINNEAPOLIS (WCCO) — A 43-year-old Vadnais Heights investment advisor pleaded guilty to accusations that he spent clients’ money on personal items instead of investing their funds, the United States Attorney’s Office announced Wednesday.

Joel William Carlson, who was charged on Aug. 4, pleaded guilty Wednesday to two counts of tax evasion for tax years 2010 and 2011.

According to documents filed in court, while acting as an investment advisor in 2010 and 2010, Carlson deposited client investments – and funds from his father – into a Trust Financial Group account, which was his personal bank account. He then spent the money on personal items. He misappropriated assets totaling more than $1.5 million, authorities say.

The attorney’s office says that when he was confronted by clients, he lied to them about the existence of their investments. Carlson also failed to file personal income tax returns for tax years 2010 and 2011.

According to his guilty plea, Carlson also failed to timely file personal income tax returns for tax years 2005 through 2007, so IRS filed a federal tax lien against Carlson for approximately $495,000.

Carlson will pay restitution to the investment fraud victims and his father. He also agreed to pay approximately $1.2 million in restitution to the IRS.

“The IRS enforces the nation’s tax laws, but also takes particular interest in cases where someone, for their own personal benefit, has taken what belonged to others,” said Special Agent in Charge Kelly R. Jackson of the IRS Criminal Investigation St. Paul Field Office. “The IRS Criminal Investigation Division, together with the Department of Justice, will investigate and prosecute those who violate our tax system.”

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