For Immediate Release: July 29, 2014
Memphis Buisness Owner Arrested on Fraud and Theft Charges
Memphis, Tenn. -The Tennessee Department of Revenue’s Special Investigations Section conducted the investigation that led to Monday’s arrest of Clayton Gately, 31, of Horn Lake, Miss. Gately’s bond was set at $5,000.
On July 10, a Shelby County Grand Jury indicted Gately on sales tax fraud, a Class E felony, and theft of property over $10,000, a Class C felony. If convicted of the fraud charge, Gately could be sentenced up to two years and fined $3,000. The theft charge carries a six year sentence and a $10,000 fine. Gately is the owner of Rhino Linings of Memphis, which applies protective spray liners to truck beds.
"This investigation serves as a reminder that retailers are not entitled to use or keep sales tax monies," Revenue Commissioner Richard Roberts said. "Sales tax revenues collected by retailers are never property of the retailer and are always the property of our state and local governments. These taxes must be remitted to the state as required by law."
Prosecution of this criminal case was pursued by the Department in cooperation with District Attorney General Amy Weirich. Citizens who suspect violations of Tennessee’s revenue laws should call the toll-free tax fraud hot line at (800) FRAUDTX (372-8389).
The Department of Revenue is responsible for the administration of state tax laws and motor vehicle title and registration laws and the collection of taxes and fees associated with those laws. The Department of Revenue collects approximately 87 percent of total state revenue. During the 2013 fiscal year, the Department collected $11.7 billion in state taxes and fees and over $2.2 billion in taxes and fees for local governments. To learn more about the Department, visit www.TN.gov/revenue.