Defendant Stole from Charity, Defrauded Donors, and Lied to IRS
Patricia Driscoll, the former executive director of the Armed Forces Foundation, was sentenced last week to 12 months and a day in prison for her role in a scheme in which she stole from a non-profit charity, defrauded donors, and lied to the Internal Revenue Service and the public about her salary and benefits.
U.S. Attorney Jessie K. Liu, Timothy Dunham, Special Agent in Charge, Criminal Division, FBI Washington Field Office, and Kelly R. Jackson, Special Agent in Charge of the Internal Revenue Service Criminal Investigation (IRS-CI) Washington D.C. Field Office made the announcement today.
Driscoll, 41, of Ellicott City, Maryland, was found guilty of two counts of wire fraud and two counts of tax evasion, all federal offenses, and one count of first-degree fraud, a District of Columbia offense, in November 2018. The verdict followed a trial in the U.S. District Court for the District of Columbia. In addition to the period of incarceration, the Honorable Richard J. Leon ordered Driscoll to serve 36 months supervised release, a period of home confinement, 360 hours of community service, and to pay $154,289 in restitution and $81,779 in a money judgment forfeiture.
According to the government’s evidence, until July 2015, Driscoll was the executive director of the Armed Forces Foundation, a tax-exempt non-profit charity based in Washington, D.C. The foundation’s stated mission was to protect and promote the physical, mental, and emotional wellness of military service members, veterans, and their families.
“The mission of the Armed Forces Foundation was to protect and promote the physical, mental, and emotional wellness of military service members, veterans, and their families,” said U.S. Attorney Jessie K. Liu. “Patricia Driscoll lied and decided to use the foundation for her own personal gain and schemes such as these undermine the work of non-profit organizations.”
While Driscoll was the executive director, in its promotions and requests for money, the Armed Forces Foundation claimed that 95% of all donations went directly to military members and their families through the charity’s programs. As a “highly compensated individual,” Driscoll’s salary and benefits were required to be disclosed on annual reports (called “Form 990”) to be filed each year with the IRS. These publicly available documents are often used by charity watch groups and donors to judge worthiness of the charity and by the IRS to determine whether the organization was operating with IRS law and regulations.
According to the evidence, Driscoll caused false reports to be filed on the Form 990s in a number of ways. For example, she failed to include the fact that she received commissions from fundraising, the amounts of commissions that she received from fundraising, and the other benefits that she received. Driscoll also falsely categorized and caused others to falsely categorize expenses in the Armed Forces Foundation’s books and records as being for the benefit of the veterans, troops, and their families, when, in fact, they were for her own private benefit. Driscoll also concealed from the foundation’s accountants the money she took from the charity, such as rent that was paid for the use of office space in a building that she co-owned.
Additionally, Driscoll falsely reported and caused others to falsely report the amount of donations received by the foundation on Forms 990, by inflating the amounts of donations and incorrectly listing the types of donations. According to the evidence, she sent false and fraudulent Forms 990 to members of the foundation’s Board of Directors and to the IRS, and caused to be published Forms 990, containing false and fraudulent information.
The jury found that Driscoll took the foundation’s money for her own personal use and to pay her for-profit business expenses. The tax evasion charges are for tax years 2012 and 2013.
In announcing the verdicts, U.S. Attorney Liu, Special Agent in Charge Dunham, and Special Agent in Charge Jackson commended the work performed by Special Agents from the FBI and Revenue Agents from the IRS. They also acknowledged the efforts of those who handled the case for the U.S. Attorney’s Office, including Victim/Witness Advocate Yvonne Bryant; Victim/Witness Services Coordinators Tonya Jones and Katina Adams-Washington; Supervisory Paralegal Specialist Tasha Harris; Paralegal Specialists Diane Brashears and Amanda Rohde; Forensic Accountant Bryan Snitselaar; Assistant U.S. Attorney Diane Lucas; former Paralegal Specialists Christopher Toms, Corinne Kleinman, and Kaitlyn Kruger; Litigation Technology Supervisor Leif Hickling; former Litigation Technology Supervisor Josh Ellen, and David Goodhand, Special Counsel to the U.S. Attorney, who provided midtrial legal research and writing.
Finally, they expressed appreciation for the work of Assistant U.S. Attorneys Virginia Cheatham, Kathryn Rakoczy, and Derrick Williams, who investigated and prosecuted the case.