Former Renton Bank CEO Jailed For Tax Fraud: Feds

RENTON, WA — The former CEO of Renton-based First Savings Bank Northwest will go to jail for one year and one day for failing to report some $2.3 million in income, federal prosecutors say.

Victor Karpiak, 64, was sentenced last Friday in Wisconsin, where he now lives. Karpiak will also have to pay more than $1 million in fines and backs taxes, and spend a year on supervised release.

According to federal officials, the tax fraud charge stems from Karpiak's oversight of a bank customer's family trust between 2010 and 2016. He paid himself more than $3.2 million in fees, but only reported $943,000 of it on federal tax forms, federal officials said.

Prosecutors highlighted that Karpiak was already earning a large salary as CEO of the bank, and had a $150,000 per-year pension after he retired in 2013. Prosecutors said he "effectively stole" from taxpayers.

"The U.S. tax system works because honest law-abiding taxpayers know that everyone, including corporate officers, are paying their fair share," Seattle field office IRS investigator Justin Campbell said in a statement.

First Savings Bank Northwest changed its name to First Financial Northwest Bank in 2015.