BANGOR — Marshall Swan walked in handcuffs from a federal courtroom Monday on his way to begin a 33-month prison term for falsifying five years’ worth of income tax returns and failing to report some $650,000 in income between 2006 and 2010.
The Chelsea contractor — who turns 57 Tuesday — paid the $145,000 owed in back taxes, but still must pay a $40,000 fine, which U.S. District Court Judge John A. Woodcock Jr. calculated as equaling 10 percent of his net assets.
The prison term was at the top end of the federal sentencing guidelines in his case, and only three months shorter than sought by the prosecutor, Assistant U.S. Attorney Donald Clark, who said it was a case of “unconscionable greed.”
Woodcock told Swan he opted for the top end of the guideline because Swan had obstructed justice in sending two men — Samuel Stone and William Dalrymple — to damage property belonging to Frank Monroe, the Whitefield contractor who was the main witness against Swan’s wife, Carole Swan. She was accused of extorting money from Monroe in return for his keeping a contract with the town of Chelsea, where she was a longtime selectwoman.
Woodcock said that attempt at witness intimidation struck “at the very heart of the judicial system.”
The damage to Monroe’s two pickup trucks and heavy construction equipment occurred late on Nov. 3, 2012, a few days after both Swans were indicted on numerous federal fraud charges and shortly after Marshall Swan met with the men.
Federal agents joined the investigation that led to Stone and Dalrymple.
Monroe watched the sentencing hearing and had written a letter to the judge about how the Swans’ actions affected his life, but he did not testify on Monday.
Woodcock told Swan he was impressed by Monroe’s courage in coming forward despite the threats.
“That tells me a lot about him,” Woodcock said.
Woodcock said he concluded that “the defendant has a need for control,” but that “the complicated and abusive relationship (with his wife) does not explain why he does not pay his taxes.” He said, “By cheating on your taxes, Mr. Swan, you cheated all of us.”
During the one year of supervised release that follows the prison term, Woodcock ordered Swan to undergo batterers’ counseling, saying he believed earlier testimony from Carole Swan and the Swans’ two sons about how Swan abused his wife.
“I think you need to change your ways for the sake of your family and for your sake,” he said.
At the sentencing hearing, Marshall Swan, in his first public comments about the case, said he made mistakes, partly by spending so much time working on his various jobs and not with his family.
“I’m totally proud of every job I’ve done for the town,” Swan said. “I’m totally proud of every job I’ve done for people, my neighbors. Again, not only aesthetics are important, but drainage.”
He told the judge that he and his wife reunited after she spent several months living at the Senator Inn in Augusta, and they realized they could not afford that. Swan asked the judge for “any alternative to having both parents incarcerated at the same time.” Their sons are Jacob, 29, and John, 19.
Swan said that he plans to spend less time hands on at the job site and will do all the banking, bill-paying and tax recording himself.
“I’m trying to work hard and pay the outstanding debt,” he said.
Another of his objectives, he said, is to get his wife off prescription drugs which she has been taking for years for nerve damage.
Swan also said his income is dropping and he has sold a lot of equipment to pay the taxes and other bills. He said he’s recognized as a skilled contractor, doing roadwork, foundations and septic installations.
“I can earn a living with a push broom or an excavator, but I can’t pay great big fines with a push broom,” Swan testified when he briefly took the witness stand to speak about the state of his finances following his conviction by a jury on Oct. 2, on the five counts of tax fraud. He had been free on bail until the concluding of Monday’s sentencing hearing.
Swan said he is saving the $47,000 profit from the recent sale of their home to pay workers compensation restitution for his wife. Carole Swan is set for a sentencing hearing next week on the same tax falsification charges, two counts of defrauding workers’ compensation and three counts of extortion as a town official. Carole Swan watched the hearing from a bench at the back of the courtroom, and the couple’s sons Jacob and John, testified Monday on his behalf.
“Everybody makes mistakes,” Jacob Swan said. “I understand some mistakes are more serious than others.”
He said if his father was unable to pay the fine, he would help him.
“My dad has me on the right path in life,” said the younger son, John, 19. “I need my father.”
Woodcock also said the Swans’ case has split the town of Chelsea into two camps, those who support the Swans and can’t believe they would do wrong, and those who believe whole-heartedly in their guilt. “You split the community down its fault lines,” Woodcock told him, noting that some residents were in the back of the courtroom.
“I suspect, Mr. Swan, that what led to all this is that in the course of time you began to feel like you and Carole ran the town of Chelsea and you began to feel that what you did made you above the law.”
Woodcock said they had “more than a healthy dose of arrogance.”
Just before Swan was led from the courtroom, he hugged and kissed his wife and two sons, reaching over the low wall between them.
Carole Swan said she did not want to comment.
After the hearing, Clark repeated some of the judge’s words, saying, “The victims here were all the people who pay their taxes.”
Marshall Swan’s defense attorney Walter McKee, said afterward, “We were disappointed with the sentence and had hoped for significantly less. He accepted responsibility for what happened and is going to move forward from here.”
McKee had sought a delay in the sentencing so that a new accountant could resolve some tax problems regarding the sale of equipment. However, Woodcock rejected that as well as a later bid to have Swan self-report to a federal prison.