The owner of staffing companies serving businesses in Pennsylvania and Maryland pleaded guilty to federal charges of conspiracy to defraud the US and failure to pay employment taxes, the US Attorney’s Office for the District of Maryland reported Thursday. Jimmy Danh admitted that the total amount of taxes he failed to pay from 2007 to the present was $549,730.23.

From 2007 to 2017, Danh and co-conspirator Darasomalee Thach operated a series of companies that supplied temporary staffing. As detailed in the plea agreement, beginning in 2007, Danh and Thach incorporated Team Work Inc. to operate a labor-leasing business to secure day-labor contracts, and agreed to evade employment taxes in order to maximize profits. From Oct. 1, 2011, to Sept. 30, 2015, Team Work paid wages totaling approximately $1.6 million to its workers.

Danh and Thach did not maintain business records relating to the operation of Team Work, including employees, payroll and tax withholdings, according to the US Attorney’s Office. Clients paid Team Work lump sum payments for all of the hours that employees worked, with the agreement that Team Work was responsible for paying its employees and for all employment-related withholdings.

Danh admitted that for tax years 2011 to 2015, he and Thach failed to consistently file an Employer’s Quarterly Federal Income Tax Return, and underreported the employee share of the Social Security and Medicare taxes in the amount of $113,144.19, and the withholding taxes in the amount of approximately $252,827.81. 

From about Oct. 31, 2015 to Oct. 31, 2017, Danh conducted his business via a Maryland corporation, JD Team Work Inc. and failed to file Employer’s Quarterly Federal Income Tax Returns and to withhold Social Security, Medicare and employment taxes. During this time, the total amount of taxes Danh failed to pay was $183,758.23.

As a special condition of his supervised release, he will be required to execute a Closing Agreement with the IRS in order to resolve tax liabilities for tax years 2007 through 2017. Danh faces a maximum sentence of five years in prison for each of the two counts but actual sentences for federal crimes are typically less than the maximum penalties. Sentencing is scheduled for Feb. 23, 2021.

Thach previously pleaded guilty to related charges in US District Court for the Middle District of Pennsylvania in Harrisburg and is awaiting sentencing.