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March 18, 2005

Okeechobee Mobile-home Dealer Arrested in $73,000 Tax Theft Case

TALLAHASSEE - A Clewiston man has been arrested on charges that he stole more than $73,000 in sales tax that he collected from customers but failed to send in to the state, the Florida Department of Revenue announced.

Michael A. Varnum, 54, of Clewiston, was arrested late Thursday in Sebastian, Florida, by the Florida Highway Patrol on felony charges relating to failure to file tax returns and pay tax. If convicted, he faces up to 5 years in prison and up to $5,000 in fines, as well as possible repayment of stolen tax, interest, penalty and investigative costs. Varnum owned and operated Central Homes of Okeechobee, Inc., at 807 N.E. Park St., Okeechobee. The business is no longer in operation.

According to Revenue Department investigators, Varnum routinely collected sales tax from customers who bought mobile homes at his business. However, during various periods between March 2003 and June 2004, Varnum failed to send in to the state all of the sales taxes that he had collected. Investigators found that Varnum had illegally kept $73,831.24 in tax money. Under state law, sales tax is the property of the state at the moment of collection. DOR staff repeatedly contacted Varnum to help him come into compliance with state tax law, but he failed to meet his legal obligations.

"To be fair, tax law must apply uniformly to all businesses," said Jim Zingale, executive director of the Revenue Department. "Tax cheats steal money that the public pays to support vital public services, such as law enforcement and education. They also steal a competitive advantage over honest businesspeople who pay their taxes. The Department of Revenue cannot and will not allow this to occur. "

If you have information about tax theft, please call the Florida Department of Revenue investigations office in West Palm Beach at 561-640-2874.