Former bank chief admits to years of filing false tax returns

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A former chairman and CEO of First Financial Northwest in Renton, Wash., has admitted to filing false tax returns.

Victor Karpiak, who pleaded guilty Feb. 27 in U.S. District Court in Wisconsin, admitted that he failed to report more than $2.3 million in income between 2010 and 2016.

During that time, Karpiak was a trustee and consultant for the beneficiary of a family and marital trust, the Justice Department said in a press release announcing the plea. Karpiak admitted that he paid himself nearly $3.3 million in fees, but reported less than a third of the income.

As part of his plea, Karpiak agreed to pay $867,540 to the IRS, along with any interest or civil penalties the agency imposes.

Karpiak, 64, now lives in Wisconsin. His sentencing is scheduled for May 17.

Karpiak's tenure as chairman, president and CEO of First Financial included years of battles with Stilwell Group, a prominent activist investor.

He agreed to resign as chairman in December 2012 as part of a settlement with Stilwell. Stilwell had filed a lawsuit challenging the results of First Financial's board elections, in which Karpiak defeated one of the investor’s nominees.

Karpiak, who spent 36 years at First Financial, stepped down as president and CEO in August 2013.

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