DOJ announces the sentencing of Atlanta government official, Larry Scott.

ATLANTA – Larry Scott has been sentenced to federal prison for failing to disclose to the City of Atlanta that while he served as the Director of Contract Compliance, he also secretly worked as the business manager for consulting firm that was hired by businesses who wanted construction contracts in the Atlanta-metropolitan area.

“Scott’s conviction and sentence close yet another chapter in the disappointing saga of corruption within the City of Atlanta government,” said U.S. Attorney Byung J. “BJay” Pak.  “Based on his executive-level positions, Scott was trusted to serve the citizens of Atlanta.  By failing to disclose his own business interests, however, Scott betrayed the program he was charged to protect – and, as a result, tarnished the integrity of Atlanta’s disadvantaged business program.”

“The law is clear on the issue of taxable income and who is required to file and pay taxes: there is no gray area on the subject and we hope today’s sentencing sends a message that intentionally filing a false tax return is a prosecutable crime regardless of your position,” said Thomas Holloman, IRS Criminal Investigations, Special Agent in Charge, Atlanta Field Office.

From 2002 to 2019, Scott held several positions with the City of Atlanta. On February 23, 2011, Scott incorporated Cornerstone U.S. Management Group, LLC (“Cornerstone”) with the Georgia Secretary of State as a for-profit corporation.  Cornerstone is a consulting firm for businesses seeking construction contracts in the Atlanta-metropolitan area and elsewhere.

As the City of Atlanta’s Senior Contract Compliance Manager, Director of Procurement, and Director of Contract Compliance, the City of Atlanta required Scott to complete annually a Financial Disclosure Statement listing any outside employment and sources of income of more than $5,000 per year for calendar years 2012 to 2017.

From 2012 to 2017, Scott electronically filed six false Financial Disclosure Statements, each executed under penalty of perjury. On each Financial Disclosure Statement, Scott knowingly failed to disclose that he had been employed by Cornerstone and that he had received more than $5,000 in annual income from Cornerstone.

From 2012 to 2017, Scott earned approximately $220,000 from Cornerstone while serving as a full-time management or executive level employee with the City of Atlanta.  Scott never disclosed to the City of Atlanta his employment with and income from Cornerstone.

From 2012 to 2017, Scott also filed six false and fraudulent federal income tax returns – in that Scott failed to report the majority of the income that he earned from Cornerstone on his tax returns.

On September 4, 2019, Larry Scott, 55, of Atlanta, pleaded guilty to a criminal information charging him with one count each of wire and tax fraud.  Based on those convictions, Scott was sentenced to two years in prison to be followed by three years of supervised release and was ordered to pay approximately $125,000 in restitution.

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