Windham Man's Co-Conspirator Pleads Guilty to Tax Evasion

A 70-year-old Manchester man has pleaded guilty to conspiracy and tax evasion charges in a scheme conducted along with a Windham resident.

Raymond Stebbins, 70, pleaded guilty before U.S. District Judge George A. O'Toole Jr. to two counts of conspiracy, five counts of tax evasion and two counts of making false statements and theft of public money.

Stebbins was an employee of Christopher McGadden of Windham, who was sentenced in 2011 on tax evasion and conspiracy charges.

Stebbins could receive the following maximum sentences for each charge:

Five years in prison, three years of supervised release and a $250,000 fine for each count of conspiracy and false statements.

Five years in prison, three years of supervised release and a $100,000 fine for each count of tax evasion.

Ten years in prison, three years of supervised release and a $250,000 fine for each theft of public money.

According to a release from the office of U.S. Attorney Carmen M. Ortiz, Stebbins was engaged in two schemes – first, a false invoice scheme aimed at evading the ascertainment and assessment of income taxes, and second, a Section 8 housing fraud scheme.

In the first scheme, Stebbins engaged in a conspiracy with McGadden to divert monies from Xcel Fire Protection, Inc. to various corporate bank accounts. The two men used those accounts to pay themselves without reporting. Xcel is based in Salem, and is a fire protection sprinkler business.

The practice saw Stebbins giving McGadden 90 percent of the proceeds of those checks in cash while keeping 10 percent for himself.

A total of $490,000 was reportedly taken from Xcel checks and Xcel customer checks.

The scheme took place starting in 2001.

The second conspiracy, which started around December 30, 1999, saw Stebbins collaborating with another unnamed individual to defraud the Internal Revenue Service.

The two men fraudulently diverted more than $3.3 million in funds from a Nashua-based construction company. The scheme, although larger in scope, was nearly identical to that of Xcel.

Stebbins attempted to evade a large part of income tax owed to the IRS between 2005 and 2009 by filing erroneous returns which under-reported his income.

Stebbins also made false statements to the U.S. Department of Housing and Urban Development when applying for the Section 8 Housing Assistance Program. The program provides housing assistance payments to people who need rent subsidy in order to obtain adequate housing.

The following information in the release further details the HUD scheme:

Beginning in December 1997, Stebbins represented to HUD that he was unable to afford adequate housing.  As a result, Stebbins received Section 8 benefits from June 1998 through May 2008.  During this time, HUD periodically attempted to establish Stebbins’ continued eligibility for Section 8 benefits, and the level of those benefits, by sending him annual re-certification forms which requested information concerning his household income level and assets.  Stebbins filled out the forms with false entries that under-reported his household income and assets. At the time he was receiving Section 8 benefits from HUD, Stebbins was an approved Section 8 housing assistance landlord for two multi-family properties, one in Quincy and another in Nashua, NH.  Between January 1, 2002 and May 31, 2008, Stebbins effectively stole money from HUD in the form of Section 8 housing payments that he was not entitled to.

Stebbins is scheduled to be sentence on June 11.