WILLIAMSBURG, Va. — Author's note: The video above is on file from July 15, 2021.
A Williamsburg businessman connected to Ford’s Colony, a large resort community, was convicted on tax fraud charges Monday.
Michael J. Tiernan, 62, faces a maximum penalty of seven years in prison on charges of filing false income tax returns and failing to file an income tax return. Actual sentences for federal crimes are typically less than the maximum penalties.
According to the U.S. Attorney’s Office for the Eastern District of Virginia, Tiernan was the financial officer for several entities related to Ford’s Colony from at least 2014 through 2017.
For the tax years 2015 and 2016, Tiernan filed federal income tax returns falsely understating the income he received from these entities. He offset his claimed income with high deductions, resulting in zero taxable income for both years. He also claimed to be insolvent in order to exclude the discharge of debt in 2015.
Evidence presented in his trial showed that Tiernan got underreported income from the entities of at least $289,401 in 2015 and at least $204,523 in 2016. He cashed many of the checks he wrote and received and deposited cash into his personal bank account. He also didn't file a tax return for 2017, despite receiving $111,352 from one business.
From 2015 to 2017, he deposited over $1.6 million into his personal bank account and spent nearly all of it using checks and debit card transactions. He further prepared and filed business tax returns for the entities concealing the true compensation he got.
Tiernan is scheduled to be sentenced on March 2, 2022.