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New charge filed against Duluth man accused of pocketing mistaken tax refund

A trial scheduled to start Tuesday for a Duluth businessman accused of stealing nearly $800,000 from the Minnesota Department of Revenue was postponed as a new attorney took over the case and the St. Louis County Attorney's Office filed an amende...

Kevin Charles Owens
Kevin Charles Owens

A trial scheduled to start Tuesday for a Duluth businessman accused of stealing nearly $800,000 from the Minnesota Department of Revenue was postponed as a new attorney took over the case and the St. Louis County Attorney's Office filed an amended complaint with another theft charge.

Kevin Charles Owens, 52, was earlier charged with four felonies -- theft, failure to pay over state funds, failure to pay income tax and failure to file a tax return -- in connection with the missing $782,962.18. He had been erroneously refunded the money by the Minnesota Department of Revenue.

In the amended complaint, St. Louis County prosecutor Nathaniel Stumme added a fifth felony count of "theft with indifference to the rights of the owner."

"The facts indicate that Mr. Owens received an enormous amount of money in the form of two checks issued by the Minnesota Department of Revenue by mistake," Stumme said when asked why he added the new charge. "Before receiving official notification of the mistake, Mr. Owens deposited the money and spent most of it paying off significant debt. I believe the new charge is the best reflection of his criminal liability. He knew he wasn't entitled to the money, he knew it would catch up to him, people told him he was probably not entitled to it, and he knew he was drowning in debt at the time."

Owens' defense attorney, Keith Shaw, couldn't be reached for comment Tuesday. Shaw asked Judge Mark Munger for a continuance of the trial after taking over the case so that he will have time to prepare for a complicated, document intensive trial. The defense also has the right to challenge probable cause for the new charge.

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Stumme has filed with the court a notice of the state's intent to seek an upward departure from sentencing guidelines because the alleged crime is a major economic offense and the "actual monetary loss is substantially greater than the usual offense."

The defendant owned Owens Yacht Sales at 371 Canal Park Drive when he was charged with the crimes on Sept. 21, 2010. He failed to show up for court and was arrested on a warrant about 20 months later, last May 24, at a Goodhue County campground in southeastern Minnesota.

According to the criminal complaint: On March 18, 2008, the Department of Revenue issued two checks made payable to Owens Yacht Sales Inc. in the amounts of $560,980.12 and $221,982.06.

The department said the checks were issued erroneously "due to human error" and "somewhat complicated internal accounting errors."

According to bank records, Owens redeemed the checks on March 25, 2008. A Revenue Department internal investigation found that the checks were inadvertently issued. Owens was notified of the erroneous refund and was repeatedly requested to return the money or to make arrangement for payments, but he refused to do so.

In July 2008, a Revenue Department examiner received a letter from Owens saying he intended to appeal the notices he received indicating the erroneous refunds. That same month, Owens allegedly told a Revenue Department employee that he had been hassled enough by the department and that he intended to keep the money. Bank records indicate Owens spent the entire $782,962.18 within several months.

Related Topics: CANAL PARKCRIME
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