A Mississippi businessman who failed to pay more than $150,000 in taxes avoided prison time Tuesday after federal prosecutors credited him with assisting the FBI’s investigation of a bid-rigging and kickback scheme at the Orleans Parish Sheriff’s Office — a probe that has netted guilty pleas from two top officials and a former contractor for Sheriff Marlin Gusman.
The businessman, Kendall O. Marquar, who did not report more than $500,000 of income to the Internal Revenue Service between 2007 and 2009, faced up to a year behind bars under federal sentencing guidelines. But he received 12 months of probation after Assistant U.S. Attorney Matthew Chester advocated a more lenient sentence.
“We can’t make these kinds of cases without cooperation,” Chester told Magistrate Judge Sally Shushan.
Marquar, of Bay St. Louis, will be monitored electronically for at least a portion of his probation, although Shushan said those restrictions would not interfere with his work in the seafood processing industry.
Shushan said Marquar has no previous criminal history and “appears to be, but for his failure to file taxes, a good man.” His sentence includes a fine of more than $3,000 to cover the cost of supervision and $156,941 he must pay in back taxes to the IRS.
Defense attorney David Ichiro Courcelle described Marquar as “extremely remorseful.”
“It won’t happen again,” Marquar told the judge, apologizing for his actions in front of his family. “I will make you and the courts proud of me.”
A large portion of Marquar’s unreported income stemmed from work performed for the Sheriff’s Office by his company, K&D Earthworks, a maintenance and construction vendor. Marquar drew scrutiny from federal agents investigating questionable contracting within Gusman’s office — a case that yielded guilty pleas from John Sens, the sheriff’s former purchasing director, and Col. Gerard Hoffman, the sheriff’s former maintenance director.
“Kendall Marquar knew that failing to file his income tax returns was a violation of the law and would bring about severe consequences,” said Gabriel L. Grchan, the FBI’s special agent in charge of IRS criminal investigations. “Now he must accept the punishment for his actions.”
Marquar had been close to Billy Short, a former chief deputy who, before his October 2011 death, was a central figure in the federal investigation of the Sheriff’s Office, though he was never charged with a crime.
Marquar had facilitated the permit for a pool built at Sens’ home in Waveland that later figured into Sens’ guilty plea to bribery and bid-rigging charges.
Richard Molenaar III, another jail contractor who pleaded guilty in the scheme, admitted paying for the pool, which cost about $25,000.
Marquar also had been listed as a principal in Gulf State LLC, a company the Sheriff’s Office called upon in 2012 to make a series of questionable renovations to the now-shuttered House of Detention, a notorious jail facility. Those repairs, which totaled at least $213,000, were made even though the sheriff closed the facility just weeks later.
Sens, who had been a leader of Gusman’s campaign fundraising, resigned from the Sheriff’s Office in February 2012 amid the FBI probe. He pleaded guilty and was sentenced to five years in federal prison for his role in the bribery conspiracy.
Molenaar was sentenced last year to 18 months in prison.
Marquar’s plea agreement outlined standard requirements that he assist the authorities “with regard to the investigation and prosecution of criminal conduct of any other person.”
There are indications that the FBI’s probe may not be finished, including the government’s decision to file its motion seeking leniency for Marquar under seal, even though all three of the defendants he helped convict have already been sentenced.
The memorandum that prosecutors want to keep secret “contains confidential and sensitive information, including information relating to a federal investigation,” Chester wrote in an Aug. 14 filing. “This information should be kept from the public record to ensure the safety of the defendant, to protect against the disclosure of any sensitive investigative information, to protect the defendant’s privacy interests, and to protect certain investigative strategies utilized by the government in sensitive criminal investigations,” he added.
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