A "sham" corporation set up in Bermuda was allegedly used by an American to avoid his taxes, according to the United States Internal Revenue Services.

And the US investigators claim that Ronald Gomes, 61 of Rose Glen Drive, Andover, Massachusetts, failed to report a "substantial amount of income on his tax returns" and dodged income taxes by channelling money through an account at Bank of Bermuda.

Gomes was charged yesterday in federal court with tax evasion for failing to report his real income that he earned as the former President and partial owner of Digital Consulting, Inc. The United States Attorney Michael J. Sullivan and Joseph A. Galasso, Special Agent in Charge of the US Internal Revenue Service, Criminal Investigation, announced that Gomes was charged in an Information - a type of legal document - with three counts of tax evasion.

The Information alleges that Gomes, the former president and 5 percent owner of Digital Consulting, Inc. failed to report a substantial amount of income on his tax returns for the years 1993 through 1995.

The investigators claim that for each of the taxable years charged in the Information, Gomes filed a "false and fraudulent tax return which did not reveal the accurate income he earned from Digital Consulting Inc.".

The information also charges that Gomes received income from revenues that were generated by Digital Consulting Inc. and diverted to the Bank of Bermuda in order to evade the payment of federal income taxes.

The investigators said that Digital Consulting Inc. is a company located in Andover, Massachusetts, that since 1982 has been in the business of organising and conducting computer-based training seminars, trade shows, and conferences for businesses in the computer industry.

According to a release from the Internal Revenue Service, the consulting firm generates its revenue from ticket sales to participants who attend the seminars, trade shows, and other events, as well as from contracting and selling of booth space to vendors involved in these shows.

The Information alleges that from 1992 through in or about 1996, Digital Consulting Inc. diverted over $8 million of its gross receipts to Digital Consulting International, Ltd., "a sham corporation set up in Bermuda, for the purpose of evading the payment of taxes on that income," said the investigators.

Gomes, who was also Digital Consulting Inc.'s chief operating officer, was aware of Digital Consulting Inc.'s scheme to evade taxes and received approximately $913,177 from 1993 through 1995, that he failed to report on his income tax returns to the Internal Revenue Service claim the investigators.

If convicted on these charges, Gomes faces up to five years' imprisonment, to be followed by three years of supervised release, and a $100,000 fine on each of the three counts, they added.

The investigation, conducted by the Internal Revenue Service and being prosecuted by Assistant US Attorney Carmen M. Ortiz in Sullivan's Economic Crimes Unit, is continuing.