Bristol couple pleads guilty to filing false tax returns

By Kathy Helms-Hughes
STAR STAFF
khughes@starhq.com

   The operators of a Bristol wrecker service pleaded guilty Monday in U.S. District Court in Greeneville to one count each of filing false tax returns.
   Charles "Eddie" Fritts and his ex-wife, Linda Fritts, pleaded guilty before U.S. Magistrate Judge Thomas G. Hull, according to Harry S. Mattice Jr., U.S. Attorney for the Eastern District of Tennessee, and Clayton L. Cooper, special agent for the IRS Criminal Investigation Division in Nashville.
   Eddie Fritts pleaded guilty to one count of filing a false tax return for 1994, while Linda Fritts pleaded guilty to filing a false tax return for 1996. Both face a maximum sentence of up to three years in prison, a $250,000 fine and three years' supervised probation.
   The Fritts were indicted March 29, 2001, on one count of conspiracy to defraud the U.S. Treasury and Internal Revenue Service, and three counts of filing false tax returns for calendar years 1994-96.
   According to the indictment, the Fritts concealed most of the cash received from customers of Edgemont Wrecker Service by dealing in cash and not depositing the funds to their bank accounts.
   Court documents state that the Fritts filed a joint 1994 tax return reporting gross receipts in the amount of $6,600, however, their true gross receipts actually amounted to $119,000, resulting in a tax loss to the government of $34,706. The Fritts also admitted they should have reported gross receipts for 1995 of approximately $67,000, rather than the $6,600 reported. That underreporting cost the government $18,000 in tax loss. In 1996, the Fritts said they should have reported $108,000 in gross receipts rather than the $97,000 reported. Tax loss for 1996 was $3,000.
   All of the underreported income was from day-to-day operations of Edgemont Wrecker Service and from the sale of used furniture.
   The Fritts are scheduled to be sentenced June 3.
   Assistant U.S. Attorney Sarah Shults prosecuted the case for the government, which was investigated by the IRS Criminal Investigation Division.