Photo from the Renton Reporter archives

Photo from the Renton Reporter archives

Former First Financial Northwest Bank CEO sentenced for tax fraud

The former CEO and President, Victor Karpiak, hid $2.3 million of income on tax returns from 2010 to 2016.

The former president and CEO of First Financial Northwest Bank in Renton has been sentenced to one year and one day in prison, one year of supervised release and a $150,000 fine.

Victor Karpiak, 64, who retired in 2013 and left the Seattle area, pleaded guilty in February to filing false tax returns on more than $2.3 million in income from 2010 to 2016, according to the U.S. Attorney’s Office Western District of Washington.

Karpiak was sentenced on May 17 in the U.S. District Court in Wisconsin.

According to facts admitted in his plea, Karpiak served as a consultant for the beneficiary of a family and a martial trust. While he paid himself fees of more than $3.2 million, Karpiak only reported $943,322 on his taxes, less than a third of that income.

The tax loss was $867,540, which Karpiak agreed to pay to the IRS. He also agreed to pay any interest or civil penalties imposed. The interest could be more than $143,647, according to a press release from the U.S. Department of Justice.

First Financial Savings Bank Northwest, which changed its name to First Financial Northwest Bank in 2015, is a subsidiary bank of First Financial Northwest, Inc. The bank has 12 locations, including one ATM-only.

Representatives of First Financial Northwest Bank, which is headquartered in Renton, did not comment on the case in February, adding that the matter does not involve them.

The Renton Reporter covered Karpiak’s retirement plans in 2012. In the article, Karpiak discussed his succession plan to leave a strong executive team for First Financial Northwest.

IRS criminal investigation worked the case.

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