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Couple indicted on prostitution, tax fraud charges

A federal grand jury indictment was returned against a husband and wife for prostitution and tax fraud charges.

Khemwika Ernst, 38, is accused of earning money as a prostitute working in Hawaii, She allegedly deposited her earnings into an account that she jointly held with her husband, Michael Paul Ernst, 43, who then transferred the funds to a mainland bank, according to the indictment. She also allegedly sent money in a package to New Jersey, where it was deposited into his bank account.  

The two were indicted for one count of conspiring to use interstate commerce to distribute proceeds of prostitution, two counts of using interstate commerce to distribute proceeds of prostitution, one count of conspiracy to defraud the United States in the collection of income taxes, and two counts of filing a false tax return.

The indictment alleges that from 2009 through 2014, the couple filed joint federal income tax returns that did not disclose the income earned by Khemwika Ernst. They were specifically charged for filing false returns for substantially underreporting their income on federal tax returns for 2008 and 2009.

If convicted they face up to five years imprisonment for each count of conspiracy and up to three years imprisonment for filing false returns.

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