(LEX NEWS) — A Kentucky addiction treatment center CEO faces federal wire fraud and money laundering charges after a grand jury indicted him on allegations he sold the same IRS tax credits to two different buyers.
Timmy G. Robinson, Jr., of Louisa, Kentucky, owned Addiction Recovery Care, LLC (ARC), a behavioral health and substance abuse treatment provider with residential and outpatient facilities in the Eastern District of Kentucky, where he also served as chief executive officer.
According to the indictment filed June 4, in the U.S. District Court for the Eastern District of Kentucky, ARC sought Employee Retention Credits (ERC) from the IRS — a refundable tax credit available to eligible businesses that paid qualified wages to employees between March 12, 2020 and Jan. 1, 2022, and were impacted by the COVID-19 pandemic.
According to the indictment, ARC sought an ERC of $3,319,220 based on wages paid in the first quarter of 2021, and a separate ERC of $3,589,252 based on wages paid in the second quarter of 2021.
The indictment alleges Robinson sold the rights to both credits to a first buyer in mid-2025. Under that agreement, the buyer wired $2,721,761 to an ARC bank account on or about July 22, 2025, in exchange for receiving the Q1 ERC once issued by the IRS. Robinson later transferred the Q2 ERC to the same buyer in exchange for a 30-day extension on a lien release deadline tied to the original sale.
Prosecutors allege Robinson then devised a scheme to sell the same credits to a second buyer, concealing the prior transactions. On or about Oct. 27, 2025, Robinson falsely represented to a broker that both ERCs were available for purchase. Throughout a due diligence process that ran from Oct. 27 to Nov. 12, 2025, Robinson continued to make those false representations.
On or about Nov. 12, 2025, Robinson executed sale agreements with the second buyer — falsely representing that no portion of either ERC had been previously sold, transferred, or encumbered. The second buyer wired an initial purchase payment of $4,739,843.18 to an ARC bank account at Community Trust Bank.
On Dec. 2, 2025, ARC received both ERCs from the IRS. The indictment alleges Robinson directed ARC not to convey the funds to either buyer, and instead directed ARC to spend the ERC funds on operational costs and debt obligations.
Robinson faces 3 counts:
- Count 1 — Wire Fraud (18 U.S.C. § 1343): Tied to the Nov. 12, 2025 transmission of signed sale agreements to the broker falsely representing the ERCs had not been previously sold. If convicted, Robinson faces up to 20 years in prison, a fine of $250,000 or twice the gross gain or loss — whichever is greater — and 3 years of supervised release.
- Count 2 — Money Laundering (18 U.S.C. § 1957): A $325,000 wire payment on Nov. 17, 2025 to an ARC account at Truist Bank. If convicted, Robinson faces up to 10 years in prison, a fine of $250,000, and 3 years of supervised release.
- Count 3 — Money Laundering (18 U.S.C. § 1957): A $997,500 wire payment on Nov. 22, 2025 to Neubert, Pepe & Monteith, P.C. If convicted, Robinson faces up to 10 years in prison, a fine of $250,000, and 3 years of supervised release.
Each count also carries a mandatory special assessment of $100. The indictment also includes a forfeiture allegation seeking any property derived from the alleged fraud and money laundering offenses.
