Jun 3, 2014 5:32 PM
LOUISVILLE, Ky. (AP) - The founder of USA Harvest pleaded guilty Wednesday to tax evasion, mail fraud and money laundering after admitting that he spent donations to the charity on himself.
Under a plea agreement with prosecutors, 65-year-old Hugh "Stan" Curtis will pay his original organization, Kentucky Harvest, $183,354 in restitution and faces prison time when he's sentenced on Sept. 4. Prosecutors are recommending a 24-month prison sentence.
Curtis had been scheduled to plead guilty in December 2012, but the hearing was delayed after questions about his competency. A judge found him competent in November.
Curtis told a federal judge on Tuesday he had memory issues, but understood the charges.
USA Harvest used volunteers to pick up surplus food from restaurants, hotels, hospitals and various other food suppliers and delivered it to missions, soup kitchens, shelters and people in need. Prosecutors said USA Harvest is no longer in business.
Scott Cox, the defense attorney for Curtis, said his client has no recollection of the events listed in the plea agreement, but understood the evidence against him and willingly pleaded guilty.
"We were able to go through these things with him," Cox told U.S. District Judge Joseph H. McKinley Jr. "He could see these were many violations of the law. He just doesn't remember who the witnesses are."
Curtis admitted that from September 2005 through September 2007, he stole $183,354 in donations that he solicited on behalf of the nonprofit USA Harvest. Curtis acknowledged depositing $164,620 into his personal account and cashing donation checks totaling $18,734 and using the funds for his personal benefit. Curtis did not report the $183,354 as income with the Internal Revenue Service.
Curtis also admitted that from 2005 through 2008, he failed to report to the IRS roughly $341,646 in personal income from donations made to USA Harvest. From 2005 through 2008 Curtis falsely included approximately $353,165 in unreimbursed travel expense deductions on his federal income tax returns.
Of the $553,891.67 in unreported income, prosecutors said, Curtis used about $370,537.67 in USA Harvest funds to pay for personal meals, personal travel and personal entertainment expenses. In total, Curtis failed to pay $270,000 in federal income tax from calendar years 2005 through 2008.
Curtis admitted to filing false tax returns with IRS from 2005 through 2008.
"Stan Curtis used his position as sole officer of USA Harvest to divert donations meant for the poor and hungry - our neediest citizens," said U.S. Attorney David J. Hale. "He is now being held accountable for his actions."
(Copyright 2014 The Associated Press. All rights reserved.)