Nags Head Businessman Jailed on State Tax Charges

Date: 6/17/2005

RALEIGH -- A Dare County man pleaded guilty to felony tax charges Thursday in Wake County Superior Court.

Gregory Robert Hall, 35, of 126 Marina Drive, Nags Head, entered guilty pleas to seven counts of embezzling the North Carolina sales tax and seven counts of embezzling the Dare County sales tax. Hall was the owner of Island Tobacco, a retail business that sells tobacco products and accessories. The business, which is currently located in the Croatan Centre at 4711 S. Croatan Highway, Nags Head, was previously located in the Outer Banks Mall and in the Timbuck II Shopping Village in Corolla.

The state’s evidence showed that from Sept. 1, 1998 through August 31, 2004, a total of $108,239.95 in North Carolina and Dare County sales tax was charged and collected from the customers of Island Tobacco however it was not remitted to the Department of Revenue. The evidence further revealed that Hall misapplied the funds by using them to operate the businesses and to pay personal living expenses. In addition, the state introduced into evidence that Hall was previously convicted of misdemeanor failure to file and failure to pay state and county sales tax in April 1998 and was placed on probation. Within six months of that conviction, Hall began the embezzlement that resulted in the current sentence.

Superior Court Judge James C. Spencer, Jr. sentenced Hall to four consecutive 17-month minimum, 21-month maximum prison terms. The sentence was suspended and Hall was placed on supervised probation for 60 months. He was ordered to serve a 120-day active sentence as a special condition of his probation. Hall paid $30,000 to the Department of Revenue prior to his plea and was ordered to pay $78,239.95 in restitution within ten days. He was also ordered to comply with all state tax laws and enter a drug assessment and treatment program while on probation.

The charges against Hall resulted from an investigation by the Elizabeth City Revenue Office and the Department of Revenue’s Criminal Investigations Division. As a result of the search relating to his arrest on the tax charges, Hall faces addition charges for felony possession of marijuana and possession of drug paraphernalia.

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