Local cult members charged in tax evasion

CAMDEN – Three owners of a Mays Landing construction company who are members of a decades-old local cult were indicted Monday on charges of not withholding taxes on almost $700,000 from employee paychecks starting in 1996.

McKee Donato Construc-tion Co. owners Kevin McKee, 47, of Egg Harbor Township, and Joseph Donato, 46, of Mays Landing, and his wife, Inge, 44, the company bookkeeper, are members of the Restored Israel of Yahweh, or RIOY – an area group that believes it should not be subject to the government and, therefore, should not pay taxes.

The trio is accused of not withholding taxes from paychecks of employees who were also members of the group. Other employees who were not RIOY. member did have their taxes withheld. The indictment did not say how many employees were affected or whether they face charges.

The federal indictment on Monday charged McKee and the Donatos, of the 20-year-old company, with conspiracy to defraud the United States, evasion of federal employment taxes and failure to file individual income tax returns

In addition to not withholding, reporting and paying federal employment taxes, the indictment also alleges that the defendants used construction company checks to pay for personal purchases, which included automobiles, a refrigerator and painting at Donato’s personal residence.

All three defendants also were charged with failing to file personal income tax returns for 1997 through 2000.

The 21-count indictment alleges 63 overt acts. From December 1996 through December 2001, the trio under-reported employee wages by about $698,736 and Social Security taxes by $106,907.

IRS Criminal Investigation agents arrested the Donatos and McKee early Monday morning at their homes. They went before U.S. Magistrate Joel B. Rosen for their first appearance.

Authorities released Inge Donato on a $100,000 personal recognizance bond, but her husband and McKee refused to accept the conditions of bail and remain in federal custody.

The defendants will be arraigned April 22 before U.S. District Judge Jerome B. Simandle.

Assistant U.S. Attorney Thomas DiLeonardo of the Criminal Division in Camden and Chris O’Malley of the Federal Public Defender’s Office represented the trio.

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