LOS ANGELES - A former executive of a Southern California-based funeral home company was sentenced on Monday to 27 months in prison for embezzling more than $2 million from his funeral home employer and lying on tax returns he filed with the Internal Revenue Service.
The court found that Terry J. Harmon, 61, abused his position to embezzle more than $2 million and then failed to report the ill-gotten gains to the IRS. In addition to the prison term, Judge Mark C. Scarsi ordered Harmon to pay a total of $2,567,848 in restitution to his former business partner and the IRS.
Harmon previously pleaded guilty to bank fraud and two counts of tax evasion. He allegedly admitted that he stole money from his employer, Caring Funeral Service, Inc. ("Caring Funeral"), which owned and operated approximately sixteen funeral homes, mortuaries, and crematoriums in Los Angeles, Riverside, and San Bernardino Counties. Harmon embezzled money in several ways from January 2009 through around April 2012, including by diverting checks written by third parties to Caring Funeral into his personal bank account and using his business partner’s signature stamp to cash and deposit checks for his personal use.
According to the FBI, Harmon used the money he stole to fund a lavish lifestyle including paying for a house, gambling, traveling, and dining out.
Harmon also admitted that he lied on his federal income tax returns for tax years 2010 and 2011 and owes a total of $489,926 in income taxes.
"Terry Harmon stole millions of dollars from a funeral business to line his own pockets," said IRS-Criminal Investigation Special Agent in Charge Ryan Korner. "This strong prison sentence sends a clear message that thieves and tax cheats will be held accountable, and that all income is taxable no matter the source."
"The defendant represents one of the biggest threats to business - that of an insider who may possess the ability to manipulate and control financial records while having the knowledge to cover their tracks," said Kristi K. Johnson, the Assistant Director in Charge of the FBI's Los Angeles Field Office.
Harmon previously made headlines in Feb. 2020 when he lied to the family of a woman whose body was inside a casket in the back of a hearse that was stolen from outside a church. The stolen hearse was involved in a short pursuit before it crashed on the 110 Freeway in South Los Angeles.
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