Former Business Owner Pleads Guilty to Sales Tax Evasion and Theft Charges

MEMPHIS, Tenn. - The Special Investigations Section of the Tennessee Department of Revenue conducted the investigation that led to the indictment, arrest and subsequent plea of John C. Littles, former owner of Potpourri Furniture Liquidators in Memphis, Tenn. On April 14, 2008, Littles entered a guilty plea to sales tax evasion and theft over $10,000.

Pursuant to a plea agreement, Littles was sentenced to six years in the Shelby County Correctional Center for one Class C felony count of theft over $10,000 and two years in the Shelby County Correctional Center for one Class E felony count of sales tax evasion. Littles was also ordered to repay the state $70,774.24 in evaded sales tax. On May 19, 2008, Littles must appear before Judge Jim Lammey for final sentencing to determine if he serves time, receives probation or is granted judicial diversion. Additionally, civil taxes, penalties and interest will be due the state.

“The Department of Revenue promotes voluntary taxpayer compliance by educating taxpayers, aggressively pursuing criminal sanctions, and demanding accountability when taxpayers engage in fraudulent activity,” said Revenue Commissioner Reagan Farr. “This investigation underscores our department’s ongoing efforts to enforce Tennessee’s tax laws.”

On Dec. 12, 2006, Littles was indicted by a Shelby County Grand Jury on three Class E felony counts of sales tax evasion and one Class B felony count of theft over $60,000. The Class E felony counts related to the filing of false sales tax returns, failing to remit collected sales tax and obstructing a revenue officer. The indictments charged that between April 2000 and April 2003, Littles collected sales tax from the customers of his business and intentionally failed to remit those collections to the state.

This case was pursued criminally by the department in cooperation with the White Collar Crime Unit of District Attorney General William Gibbon’s Office. Citizens who suspect violations of Tennessee’s revenue laws should call the toll-free tax fraud hot line at (800) FRAUDTX (372-8389).