Saturday, March 8, 2014
By BETTY ADAMS Kennebec Journal
BANGOR – Carole and Marshall Swan of Chelsea listed on their federal tax return a gross income of negative $110,518 for the 2006 tax year.
Staff file photo by Joe Phelan
Staff File Photo
That includes a business loss of $38,000 and another loss – so far unspecified – of $79,600, in addition to $4,000 in earned wages and other gains and losses.
Testimony from Paul Crowley, a court witness coordinator from the Andover, Mass., office of the Internal Revenue Service, was halted at 2:30 p.m. Tuesday, and is expected to continue Wednesday morning in U.S. District Court in Bangor.
Also Tuesday, a former town official said Swan exerted pressure so he would award town work to Marshall Swan Construction, which was owned jointly by the couple. Crowley was presenting the tax return in support of the government's charge that the Swans falsified their income tax returns for the tax years 2006-2010.
In opening arguments Monday, the prosecutor, Assistant U.S. Attorney Donald Clark, said Marshall Swan Construction had $2.4 million in income during those years and paid almost no income tax because Carole Swan claimed huge losses for a harness horse racing business.
In court filings, Swan's attorney, Leonard Sharon, said the business was her brother's, but the horses were bought in her name because of his bad credit. Sharon also said that Carole Swan was abused by her husband and feared him.
Carole Swan, 55, is on trial on income tax fraud charges as well as charges that she defrauded the federal workers' compensation system and a federal program funding repairs while she was a town selectman.
Tuesday was the second day of her jury trial. Her husband faces similar charges of falsifying income tax returns and of aiding and abetting in the federal program fraud. He is to be tried later.
Former Chelsea Town Manager Robert Drisko testified Tuesday that he believes then-Selectwoman Swan exerted pressure outside selectmen's meetings to ensure her husband, who ran Marshall Swan Construction, got a lot of the town's road work.
"She would work outside to get her own way," Drisko said. "That's my own opinion." Drisko spent more than an hour on the witness stand in U.S. District Court describing Chelsea's process for awarding road work.
Most of the dozen other witnesses talked for five minutes or less, testifying about work Swan's husband, Marshall Swan, did on their property and how they paid for it.
Betty Adams can be contacted at 621-5631 or at: