IRS indicts former congressional candidate O'Donoghue

By Paul BrinkmannPaul Brinkmann | Reporter
Posted February 5, 2016

Former Republican candidate for Congress, Bruce William O’Donoghue, is set for arraignment Friday on an IRS indictment for alleged tax evasion.

O’Donoghue, of Winter Park, tried to run against U.S. Rep. Alan Grayson, D-Orlando, in 2010, but did not receive the Republican nomination. During his campaign, the IRS filed a lien against O’Donoghue for failure to pay $219,962, plus interest and penalties, in payroll tax for his engineering company.

At the time, O’Donoghue claimed that the problem stemmed from his former financial officer embezzling from him.

On Wednesday, the IRS filed an six-count indictment alleging unpaid payroll tax in 2009 and 2010. The IRS also alleges that O’Donoghue borrowed $125,000 from his company – Control Specialists Co. – for his campaign, and failed to pay the money back.

O’Donoghue’s attorney, Stephen Calvacca, said Friday that O’Donoghue has paid some of the money back and is prepared to pay it all back.

“We are preparing to pay back $375,000 to meet the IRS demands,” Calvacca said. “I think this is a wrong-headed prosecution.”

Calvacca said a former executive did embezzle some money from Control Specialists, but he didn’t think that was the biggest problem O’Donoghue had encountered.

“There were a series of business deals that were about to close, but never did. If they had, he would have been able to pay back the loans to his campaign. It was a perfect storm of things that went wrong,” Calvacca said.

O’Donoghue had promoted his fiscal responsibility and experience as a small businessman during his campaign. His company, which employed about 50 people, builds and installs traffic signals, crosswalks, digital information signs and other traffic equipment, often for local governments.

His company, which employed about 50 people, builds and installs traffic signals, crosswalks, digital information signs and other traffic equipment, often for local governments. The company was started in 1965 by O'Donoghue's parents, and he has been president and CEO since 1990.

O'Donoghue was one of seven Republicans in the 2010 Republican primary in Florida's 8th Congressional District. The eventual GOP nominee, Daniel Webster, unseated Grayson; but Grayson returned to Congress after a win in 2012.

Source: Orlando Sentinel