Former country club board member suing government over IRS penalty
By Teresa Auch Schultz email@example.com August 30, 2013 11:12AM
Updated: October 1, 2013 6:48AM
A former board member of the then-private River Pointe Country Club in Hobart says he shouldn’t be held responsible for an employee not paying employee taxes for eight years, which sent the club into a debt of $1 million to the IRS.
Robert A. Chevalier, of Porter County, is suing the federal government in U.S. District Court in Hammond to get back $100,000 he paid to the IRS because of the debt.
River Pointe closed as a private club in April 2010 after officials say financial improprieties had been discovered. The lawsuit says those improprieties came down to an employee, Mary Ellen Radcliff, who never paid the IRS employee payroll taxes from 2002 to 2010, which put the club in debt to the IRS for $1 million. The club shortly reopened as a public club under new owners.
Radcliff told investigators no one else knew of her actions, the suit says, and that she faked the club’s financial books and records to hide this from everyone else.
However, the IRS assessed a $100,000 penalty against Chevalier. The only other board member it’s holding financially responsible is Sam Wright, who oversaw Radcliff.
Chevalier argues he shouldn’t be held responsible as he never signed off any checks or knew anything about the failure to pay taxes. The suit claims an investigation showed that the hundreds of checks that bore his signature from 2008 to 2010 were forged and points out that Chevalier was the one to discover and blow the whistle on the unpaid taxes.
It also notes that Chevalier didn’t become a board member until three years after the fraud started.
The IRS held Chevalier’s tax refund last year because of the debt, and Chevalier eventually paid the rest of the money to remove the debt.
However, he now claims the IRS had no right to that money and wants it back. He is also suing for legal fees.