Jobson Cenor Arrested in Identity Theft Tax Fraud Scheme Targeting U.S. Marines

Source-  http://www.fbi.gov/miami/press-releases/2012/u.s.-marine-arrested-in-identity-theft-tax-fraud-scheme-targeting-u.s.-marines 

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI); and José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID), Miami Field Office, announced that Jobson Cenor, 22, of Miami, was arrested on charges of conspiracy to commit tax refund fraud, in violation of Title 18, United States Code, Section 286. Cenor will make his initial appearance today in federal court in Wilmington, North Carolina for removal to the Southern District of Florida to face the charges.

U.S. Attorney Wifredo A. Ferrer stated, “According to the criminal complaint, defendant Cenor, a U.S. Marine stationed in Afghanistan, sold the names, dates of birth, and Social Security numbers of fellow Marines serving our country in Afghanistan to a co-conspirator, who used the stolen identities to file tax returns seeking fraudulent refunds. Identity theft is a crime that victimizes millions of Americans every day. Tax refund scams are the latest crime du jour resulting from identity theft. Still, when identity theft tax refund scams pits one Marine against another, it brings home the point that these refunds scams have become a national epidemic that must be eradicated. For this reason, the investigation and prosecution of identity theft has become one of my top priorities.”

“The charges against Jobson Cenor show our resolve to proactively fight identity theft and tax fraud,” said Dena Choucair, Acting Special Agent in Charge of the FBI’s Miami Division.

IRS Special Agent in Charge José A. Gonzalez stated, “The harm done by this defendant goes far beyond the identities stolen to commit tax-related identity theft crimes. The devastating impact that his actions have on the honest men and women serving our country may never be fully measured. Together with our law enforcement partners, we will continue to aggressively pursue and investigate those who commit tax-related identity theft crimes.”

The affidavit filed in support of the criminal complaint alleges that alleges that on January 17 and January 19, 2012, Cenor’s co-conspirator submitted 14 fraudulent tax returns seeking refunds to an online tax preparation company. Several of these returns were in the name of U.S. Marines. On February 9, 2012, Cenor’s co-conspirator had lists with names, dates of birth, and Social Security numbers. Several U.S. Marines whose names and Social Security numbers appear on these lists also appeared on the tax returns submitted on January 17 and 19, 2012.

On February 9, 2012, Cenor’s co-conspirator, at the direction of the FBI, made a recorded telephone call to Cenor. During that conversation, Cenor requested the two speak in Creole. Cenor’s co-conspirator explained that he/she had started filing tax returns using the identities that Cenor had provided. Cenor’s co-conspirator explained that Cenor would get half of the tax refund money, or approximately $54,000. Cenor said his co-conspirator could hold the money until Cenor returned from Afghanistan.

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Harvey Zitron Charged with Filing False Tax Returns

Source-  http://www.fbi.gov/miami/press-releases/2012/boca-raton-resident-charged-with-filing-false-tax-returns 
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID); and John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announced the unsealing of a two-count indictment charging defendant Harvey Zitron with filing false tax returns. Zitron had his initial appearance yesterday before U.S. Magistrate Judge Barry S. Seltzer.

More specifically, the indictment charges that Zitron filed with the IRS United States Individual Income Tax Returns, Forms 1040, for 2004 and 2005, knowing that his total income was greater than the amounts reported, in violation of Title 26 U.S.C. §7206(1).

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Leaders of Multi-million Dollar Fraud Ring That Used Stolen Information of Medicaid Recipients Each Sentenced to Over 25 Years in Prison

Source-  http://www.justice.gov/opa/pr/2012/May/12-tax-594.html 

Veronica Dale and Alchico Grant, who jointly ran a stolen identity refund fraud ring that attempted to defraud the United States of millions of dollars over several years, were sentenced to federal prison today, the Justice Department and Internal Revenue Service (IRS) announced. Veronica Dale, of Montgomery, Ala., was sentenced to 334 months and Alchico Grant of Lowndes County, Ala., was sentenced to 310 months in prison. In addition, Dale and Grant were both ordered to pay over $2.8 million in restitution to the IRS.

In December 2010, Dale and Grant were originally indicted, along with three others, on various tax and tax-related charges including aggravated identity theft. Dale and Grant continued their tax refund fraud while on pretrial release and as a result, Grant was indicted again in April 2011, and Dale was later named in a superseding indictment in August 2011. Both were ordered detained following the second set of indictments and have remained in custody.

On Sept. 14, 2011, Grant pleaded guilty to a total of five charges from both indictments, including conspiracy, wire fraud and aggravated identity theft. On Oct. 14, 2011, Dale pleaded guilty to a total of seven charges from both indictments, including conspiracy, filing false claims, wire fraud and aggravated identity theft.

According to the first indictment, the plea agreements and other court documents, beginning in 2009 and continuing through 2010, the defendants were part of a scheme that involved fraudulently obtaining tax refunds by filing false tax returns using stolen identities. Dale admitted that she filed over 500 fraudulent returns that sought at least $3,741,908 in tax refunds. These returns were filed using the names of Medicaid beneficiaries, whose personal information Dale obtained while earlier employed by a company that serviced Medicaid programs. Dale directed the refunds to different bank accounts that she and other co-conspirators controlled.

Also according to the first indictment, plea agreements and other court documents, Grant admitted that he opened bank accounts to receive some of the refunds and recruited others to do the same. One such recruit opened a bank account in the name of a business into which more than $1.3 million in fraudulently obtained tax refunds were deposited. Thereafter, Grant directed distribution of the proceeds which included having third parties cash checks drawn on the various accounts and remit the funds to him. Grant also instructed individuals to lie to law enforcement authorities when questioned about the checking account activities. Dale and Grant’s co-defendants – Laquanta Grant, Leroy Howard, and Isaac Dailey – have all pleaded guilty, as have two other co-conspirators, Wendy Delbridge and Betty Washington, who pleaded guilty to criminal informations.

The second indictment charged a conspiracy that involved Dale, Grant, Melinda Clayton, and Stephanie Adams. As court documents show, this conspiracy extended from January 2011 to April 2011, when federal agents executed a search warrant at Clayton’s house and arrested her. In her plea agreement, Dale admitted that this scheme involved a fraud loss of between $400,000 and $1 million. Dale admitted to providing Clayton with stolen identities in furtherance of the new scheme. Clayton stored these and other lists of stolen identities at her home. The tax refunds were directed to bank accounts and prepaid debit cards purchased by Dale and Grant. Dale, Grant, Clayton and Adams all pleaded guilty to their roles in the second scheme, as did Valerie Byrd, who pleaded guilty to a criminal information.

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Margaret Kirksey Sentenced to Federal Prison for Tax Conspiracy Involving Stolen Identity Refund Fraud

Source-  http://www.justice.gov/opa/pr/2012/May/12-tax-592.html

Margaret Kirksey, a resident of Montgomery, Ala., was sentenced today in the Middle District of Alabama to 81 months in federal prison for filing false tax returns using stolen identities, the Justice Department and Internal Revenue Service (IRS) announced.

On Jan. 24, 2012, Kirksey pleaded guilty to charges of conspiracy to defraud the government and aggravated identity theft. She was indicted by a federal grand jury on July 27, 2011, on charges of conspiracy, aggravated identity theft, wire fraud, false claims and lying to federal agents.

According to court documents, Kirksey and her co-conspirator, Yumeitrius Manuel, each owned and operated a tax preparation business in Montgomery, located in the same physical place. The two fraudulently inflated tax refunds by placing false information on their clients’ tax returns. They also filed tax returns in the names and Social Security numbers of individuals who did not know about, and did not authorize, the filing of tax returns on their behalf. Both Manuel and Kirksey admitted that their respective crimes involved over $1 million in tax loss and more than 50 victims of identity theft. Manuel has also pleaded guilty to a tax conspiracy and is scheduled to be sentenced on Aug. 8, 2012.

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Former District of Columbia Council Member Harry Thomas, Jr. Sentenced to 38 Months in Prison for Theft, Tax Charges in Scheme Involving Government Funds

Source-  http://www.fbi.gov/washingtondc/press-releases/2012/former-district-of-columbia-council-member-harry-thomas-jr.-sentenced-to-38-months-in-prison-for-theft-tax-charges-in-scheme-involving-government-funds 

WASHINGTON—Harry L. Thomas, Jr., a former member of the Council of the District of Columbia, was sentenced today to 38 months in prison on federal theft and tax charges stemming from a scheme in which he used more than $350,000 in taxpayers’ money that was earmarked for the arts, youth recreation, and summer programs for his own personal benefit, including to pay for vehicles, clothing, and trips.

The sentence was announced by U.S. Attorney Ronald C. Machen, Jr.; Assistant Attorney General Lanny A. Breuer of the Justice Department’s Criminal Division; Ronald T. Hosko, Special Agent in Charge of the FBI Washington Field Office’s Criminal Division; and Eric Hylton, Acting Special Agent in Charge of the Washington Field Office of the Internal Revenue Service-Criminal Investigation (IRS-CI).

Thomas, 51, pled guilty on January 6, 2012 in the U.S. District Court for the District of Columbia to a criminal information charging him with one count of theft concerning programs receiving federal funds and one count of filing a false tax return. As part of the plea agreement, he agreed to submit his resignation from the District of Columbia Council. Thomas is the first sitting member of the D.C. Council to be charged with and convicted of a felony.

At sentencing, the Honorable John D. Bates said that Thomas’s crimes were a “betrayal of the public trust” and directly affected programs meant to help needy, underprivileged youths.

Thomas will be required to make restitution in an amount to be set later by Judge Bates. In addition, he must forfeit a 2008 Victory motorcycle and 2008 Chevrolet Tahoe truck, both of which are traceable to proceeds of his crimes. Thomas also must pay all outstanding taxes, interest, and penalties. Finally, upon completion of his prison term, Thomas will be placed on three years of supervised release.

According to a statement of offense signed by the government as well as the defendant, Thomas arranged to steer a total $353,500 from a non-profit public-private partnership that received funding from the District government. Thomas directed the money to two entities that he controlled, and he then used it for his own purposes.

Among other things, money that was meant to benefit the District’s residents was spent by Thomas to purchase a $69,149 Audi luxury sport utility vehicle, the $23,245 Victory motorcycle, expensive clothing, restaurant meals, and luxury vacations. Thomas also used the money to cover his expenses in helping to arrange entertainment for a 2009 inaugural ball.

The case remains under investigation. Two others also pled guilty to charges in January 2012 and are awaiting sentencing.

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Stacy L. Attisano Charged with Embezzling from Credit Union and Tax Evasion

Source-  http://www.fbi.gov/pittsburgh/press-releases/2012/butler-county-woman-charged-with-embezzling-from-credit-union-and-tax-evasion 

PITTSBURGH, PA—A resident of Butler County, Pennsylvania has been indicted by a federal grand jury in Pittsburgh on charges of embezzlement from an institution insured by the NCUA and income tax evasion, United States Attorney David J. Hickton announced today.

The five-count indictment named Stacy L. Attisano, 43, of Portersville, Pennsylvania, as the sole defendant.

According to the indictment, between 2004 and 2010, Attisano embezzled in excess of $1,000 from the Lawrence County School Employee Federal Credit Union, where she was employed as the assistant manager. Attisano was also charged with tax evasion for the years 2006 through 2009.

The law provides for a maximum total sentence of 50 years in prison, a fine of $2,000,000, or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.

Assistant United States Attorney Shaun E. Sweeney is prosecuting this case on behalf of the government.

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Nine Alabama Family Members Indicted in Conspiracy to Obtain Tax Refunds Using Stolen Identities

Source-  http://www.justice.gov/opa/pr/2012/May/12-tax-580.html 

Barbara Murry, Douglas Murry, Douglas Murry III, Yolanda Moses, Lee Moses, Veronica Temple, Jeffrey Temple, Almetta Johnson and Courtney Johnson were charged in an indictment by a federal grand jury in the Middle District of Alabama on a variety of counts stemming from an identity theft and tax fraud scheme, the Justice Department and the Internal Revenue Service (IRS) announced today. The 33-count indictment charges all nine with conspiring to defraud the United States and to commit theft of public funds and with theft of public funds. Barbara Murry, Yolanda Moses and Veronica Temple are also charged with aggravated identity theft. The indictment was unsealed today.

According to the indictment, all of the defendants are related to each other. Barbara Murry owned and operated B & B Weaving Shop, located in Montgomery, Ala. B& B Weaving Shop was located in the same building as B & B Tax Service. Barbara Murry’s daughter, Yolanda Moses, owned and operated B & B Tax Service. Between 2006 and 2012, Barbara Murry, Yolanda Moses and Veronica Temple allegedly filed false federal income tax returns with stolen identities and had refunds directly deposited into the bank accounts of the defendants and others. The bank accounts received at least $1.3 million in false tax refunds.

An indictment merely alleges that crimes have been committed, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, all the defendants face terms of five years in prison for the conspiracy charge and 10 years for each theft of government funds count. Barbara Murry, Veronica Temple and Yolanda Moses face mandatory 2-year sentences for the aggravated identity theft counts. All the defendants are also subject to fines and mandatory restitution if convicted.

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Cincinnati Attorney Suzanne Land, Pleads Guilty to Obstructing IRS

Source-  http://www.justice.gov/opa/pr/2012/May/12-tax-570.html 

Suzanne Land, a Cincinnati attorney, pleaded guilty today to obstructing and impeding the Internal Revenue Service (IRS) while representing the estates of two deceased clients, the Justice Department and IRS announced. District Court Judge Herman J. Weber presided over the guilty plea hearing.

Land, who until recently was a partner at a Cincinnati law firm, admitted in court documents that from January 2010 through July 2010 she actively obstructed and impeded the IRS during two separate civil audits her clients’ estate tax returns.

According to the plea agreement and statements made in court, to conceal from the IRS the deficiencies in the documents that she drafted for her wealthy clients, Land forged the posthumous signatures of both her deceased clients and their living children on amendments to the documents. Land also misled an appraiser as to the value of the estates, created fake legal invoices that reflected work she never performed, and lied to the IRS about the circumstances surrounding the creation of the amendments. According to the terms of the plea agreement, Land admitted that the “relevant and foreseeable” tax loss that could have resulted from her obstruction was approximately $1,140,636.

Judge Weber set sentencing for Aug. 7, 2012 in Cincinnati. The maximum potential sentence for obstructing and impeding the IRS is up to three years in prison.

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David Marrero Indicted in Alabama for Filing False Tax Returns

Source-  http://www.justice.gov/opa/pr/2012/May/12-tax-567.html 

A federal grand jury sitting in Montgomery, Ala., has returned an indictment charging David Marrero, formerly a resident of Florida, with corruptly endeavoring to obstruct the Internal Revenue Service (IRS) and filing false claims, the Justice Department and IRS announced today.

According to the indictment, while Marrero was serving a federal sentence in the custody of the Federal Bureau of Prisons in Montgomery County, Ala., he began sending various false documents to the IRS and to the federal judge who had presided over his case. Among the documents he is alleged to have sent were false money orders and false tax returns making claims for refunds, which were based upon false IRS Forms 1099-OID that Marrero had prepared. Marrero also allegedly used financial documents he had obtained from other people, without their knowledge or consent, as supporting documentation for his fraudulent claims.

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, Marrero faces a potential maximum of three years in prison on the obstruction count and five years in prison on each false claims count, well as up to $1 million in fines.

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Curtis Morris and Richard Kellogg Armstrong Were Found Guilty for Scheme to File Approximately $22 Million in False Claims with the Irs

Source-  http://www.justice.gov/opa/pr/2012/May/12-crt-564.html 

Curtis Morris, 43, of Elizabeth, Colo., and Richard Kellogg Armstrong, 77, of Prescott, Ariz., were found guilty on April 30, 2012, by a jury for mail fraud, filing false claims against the United States and conspiracy to file false claims against the United States, announced the Justice Department’s Tax Division, the U.S. Attorney’s Office for the District of Colorado and IRS-Criminal Investigation. In addition to these counts, Armstrong was also found guilty of engaging in monetary transactions in property derived from the mail fraud. The guilty verdicts were the result of a three week trial before U.S. District Court Judge Robert E. Blackburn. Morris and Armstrong are scheduled to be sentenced on Aug. 10, 2012.

Morris and Armstrong were indicted by a federal grand jury in Denver on June 8, 2010 and were subsequently charged in a superseding indictment on Feb. 15, 2011. The superseding indictment charged a total of twenty-eight counts as well as forfeiture allegations and included, as a defendant, the late Larry Hall. The jury returned guilty verdicts against Morris and Armstrong on all counts with which they were respectively charged. Morris was found guilty of three counts of mail fraud, seventeen counts of filing false claims against the United States and one count of conspiracy to defraud the United States. Armstrong was found guilty of one count of mail fraud, eight counts of filing false claims against the United States, three counts of engaging in monetary transactions in property derived from mail fraud and one count for conspiracy to defraud the United States.

According to the testimony at trial, the scheme involved Hall and Morris working with others to solicit individuals to file tax returns claiming large tax refunds based upon fictitious federal income tax withholdings taken from bogus Forms 1099-OID. Morris was the scheme tax preparer. He prepared over fifty fraudulent tax returns for at least twenty clients claiming illegal refunds of approximately $22 million. Original issue discount (OID) income is a form of interest income typically realized on debt instruments issued at a discount to, or purchased at less than, the ultimate redemption value of the debt instrument. This type of income is reported to the IRS on a Form 1099-OID and can be subject to federal income tax withholding in certain exceptional circumstances that didn’t apply in this case. As part of this scheme, Morris and others fabricated IRS Forms 1099-OID claiming large amounts of bogus federal income tax withholding to make it appear that these forms had been issued by legitimate financial institutions. Morris then used these bogus forms to prepare false tax returns for clients such as Armstrong. He used the federal income tax withholding amounts reported on the bogus Forms 1099-OID to offset and exceed his clients’ calculated income tax liabilities often resulting in hundreds of thousands of dollars in claimed refunds per client per year.

Armstrong was one of the clients who successfully secured a refund through the filing of tax returns prepared by Morris and subsequently served as a promoter and recruiter for the scheme. Armstrong received over $1.6 million and, according to the testimony at trial, quickly moved most of this money into accounts in the names of shell entities and offshore bank accounts. The government seized and is seeking forfeiture of Armstrong’s private plane and two pieces of real property purchased with the fraud proceeds, one of which is a house in Brighton purchased through Larry Hall by a nominee land trust.

“Those who defy the tax laws by preparing or filing false and frivolous tax returns risk criminal prosecution resulting in conviction, substantial penalties and time in prison, as well as being required to pay their taxes, interest and penalties,” said Assistant Attorney General for the Tax Division Kathryn Keneally. “The Tax Division remains committed to prosecuting tax defier conduct.”

“The guilty verdicts are a tribute to the hard work of the trial team,” said U.S. Attorney for the District of Colorado John Walsh. “The defendants have been held accountable for their fraudulent scheme thanks to the prosecutors and IRS-Criminal Investigation. Tax preparers should take note that if they attempt to defraud the IRS they will be caught and held accountable.”

“This verdict should send a clear message that promoting or participating in a fraudulent tax scheme will not be tolerated; rest assured those who do will be brought to justice,” said Sean Sowards, Special Agent in Charge, IRS Criminal Investigation, Denver Field Office.

Mail fraud carries a penalty of not more than 20 years in prison and up to a $250,000 fine, per count. Filing false claims against the United States carries a penalty of not more than 5 years imprisonment and a fine of up to $250,000 per count. Engaging in monetary transactions in property derived from mail fraud carries a penalty of not more than 10 years imprisonment and a fine of up to $250,000 per count. Conspiracy to defraud the United States carries a penalty of not more than 10 years imprisonment and a fine of up to $250,000 per count.

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Eight Defendants Charged as Part of an Identity Theft Tax Refund Undercover Operation

Source-  http://www.fbi.gov/miami/press-releases/2012/eight-defendants-charged-as-part-of-an-identity-theft-tax-refund-undercover-operation 

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and José A. Gonzalez, Special Agent in Charge, Internal Revenue Service, Criminal Investigation Division (IRS-CID), announced the filing of charges against seven defendants arrested in connection with an FBI-led undercover operation targeting identity theft tax refund fraud. Charged in the complaint are Regina Carroll, 37, of Miami; Lanny Fried, 34, of Miami Lakes; former NFL player Louis Gachelin, 31, of Miramar; former NFL player William Joseph, 32, of Miramar; Guy Maxineau, 35, of Miami; Castra Pierre-Louis, 34, of Miami; and Gunie Similien, 32, of Miami. Each defendant allegedly negotiated between 11 and 35 fraudulently obtained tax refund checks, ranging in total value from $70,000 to $120,000. The defendants are expected to make their initial appearances in court before U.S. Magistrate Judge Robert L. Dube at 1:30 p.m. today.

More specifically, the defendants are charged with forgery of U.S. Treasury checks, in violation of Title 18, United States Code, Section 510, theft of government money, in violation of Title 18, United States Code, Section 641, and use of five or more identification documents with unlawful intent, in violation of Title 18, Untied States Code, Section 1028(a)(3). If convicted, these charges carry a maximum statutory sentence of between five to 15 years in prison.

According to the complaint, from February 2012 to April 2012, the FBI operated a financial services store (the store) in North Miami to accept fraudulently obtained tax refund checks from individuals looking to cash those checks. Undercover FBI agents worked at the store and charged large fees, ranging from 35 percent to 45 percent of the face value of the checks, for their check cashing services. According to the complaint, individuals would come to the store to cash the fraudulently obtained tax refund checks using false identification documents in the name of taxpayer victim whose refund had been stolen. Often, the defendants would forge the victim’s signature on the back of the check while inside the store. Many of the victim taxpayers whose names appear on the refund checks have already filed identity theft affidavits with the IRS.

During the three-month undercover operation, the defendants negotiated with undercover agents at the store to cash approximately $500,000 in fraudulently obtained tax refund checks. The conversations and transactions between the customers and undercover agents at the store were audio and video recorded by the FBI. The FBI paid the thieves from official FBI funds and none of the tax refund checks were actually cashed.

U.S. Attorney Wifredo A. Ferrer stated, “Not only is identity theft America’s fastest-growing crime, it’s also a consumer’s worst nightmare. Most recently, identity theft has become a taxpayer’s worst nightmare also. As this three month undercover operation illustrates, identity thieves are using stolen identities to commit steal tax refunds from legitimate taxpayers. Identity theft, when combined with tax refund schemes, threatens the financial security of our citizens. It is time for tax refund scammers to realize that we will not allow them to steal others’ identities and line their pockets through fraud.”

“Organized criminals are stealing $5 billion and more by fraudulently claiming tax refunds,” said John V. Gillies, Special Agent in Charge of the FBI’s Miami Division. “Without proper safeguards, identity theft tax fraud has become a growing epidemic. The FBI is proactively going undercover to fight the fraud but unfortunately today’s arrests are just the tip of the iceberg.”

José A. Gonzalez, Special Agent in Charge of IRS-CID, added, “Tax-related identity theft crimes are corrupting our tax system with false information, to the detriment of innocent taxpayers and the United States Treasury. For this reason, IRS is committed, along with our law enforcement partners, to aggressively investigating all parties involved in these crimes, and making sure that no such crime goes undetected.”

In a separate but related case, another former NFL player, Michael Antwon Bennett, 33, was charged by complaint with wire fraud, in violation of Title 18, United States Code, Section 1343. He is expected to make his initial appearance in federal court this afternoon before U.S. Magistrate Judge Robert L. Dube at 1:30 p.m.

The complaint alleges that Bennett, a former NFL player, attempted to obtain a $200,000 loan on April 18, 2012 from the same FBI undercover store, using a bank statement falsely indicating that Bennett had $9 million in collateral for the loan. According to the complaint, on April 18, 2012, to obtain the loan, Bennett showed an undercover agent at the store a UBS financial statement in Bennett’s name. The bank statement purportedly showed a balance of approximately $9 million. Bennett signed a loan agreement for the loan. On April 30, 2012, Bennett picked up $150,000 in a cashier’s check from the store and was subsequently arrested. FBI agents contacted UBS, and UBS confirmed that Bennett’s account held a zero balance and that the account never had any money in it.

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Howard Levine Sentenced to 37 Months for Tax Fraud in The Preparation of False Income Tax Returns for Clients

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-547.html 

Howard Levine, owner of a Dix Hill, N.Y., tax preparation business was sentenced to 37 months in prison for tax crimes, the Justice Department and Internal Revenue Service (IRS) announced today. On Jan. 5, 2012, Levine pleaded guilty to obstructing the internal revenue laws and aiding in the preparation of false income tax returns for clients.

According to the plea agreement and statements made in court, Howard Levine owned and operated Milaur Associates, also known as Milaur Inc. Many of the tax returns prepared by Levine for 2004 through 2009 were false and contained fictitious deductions, business expenses and corporate losses created by Levine. According to court documents, Levine admitted to preparing no fewer than 56 false income tax returns, resulting in a tax loss of more than $620,000.

In 2009, the U.S. District Court for the Eastern District of New York issued an injunction that barred Levine from preparing federal income tax returns for anyone other than himself. According to the plea agreement, Levine violated that court injunction and continued to prepare false income tax returns for clients. In order to obstruct and mislead the IRS from determining his role in preparing the returns, Levine provided false information in the paid preparer section of the returns he prepared.

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Richard Jaensch Sentenced for Filing a False Refund Claim Based on Forms-1099 and for Failing to File Tax Returns

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-552.html 

Richard Jaensch, 54, of Annandale, Va., was sentenced today to 36 months in prison by U.S. District Judge Gerald Bruce Lee, the Justice Department and Internal Revenue Service (IRS) announced. Jaensch had been found guilty on Dec. 7, 2011, by a federal jury sitting in Alexandria, Va., of corruptly endeavoring to impede the IRS, filing a false claim for a refund and four counts of failing to file tax returns for 2004 through 2007. Judge Lee also sentenced Jaensch to three years supervised release and ordered him to pay $197,984 in restitution to the IRS.

According to evidence introduced at trial, Richard Jaensch, a self-employed plumber, failed to file personal income tax returns for many years, beginning in 2002, despite the fact that he was required to do so by law because of income he made from his business and from stock trading. The first tax return he filed after 2002 was a false 2008 tax return claiming a $774,052 refund based on false Forms 1099-OID that the defendant submitted to the IRS.

Over the years, Jaensch also obstructed and impeded the IRS by, among other acts: filing numerous documents and pleadings in Fairfax County, Va., claiming, that he and his wife, a federal employee, were not persons required to file federal income tax returns; that his wife was not a party to the Constitution of the “united States of America” and that she was not a taxpayer; and providing false information to the IRS. In addition, Jaensch caused his wife to present letters to her employer directing them to stop withholding federal income taxes from her salary. The IRS began levying his wife's paycheck and bank accounts to satisfy her outstanding tax liability and Jaensch continued his obstructive conduct by filing or causing his wife to file correspondence with the IRS claiming that the IRS could not instruct her employer to withhold taxes from her paycheck.

Jaensch’s wife, Janet, was a former high-level civilian employee in the Department of the Navy during the time that she was not filing tax returns at Richard Jaensch´s direction. She pleaded guilty to willfully failing to file a tax return and was sentenced on Dec. 13, 2011, to three years of probation and order to pay more than $137,000 in restitution to the IRS.

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Ernst Pierre Pleads Guilty to Identity Theft and Wire Fraud

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-525.html 

Ernst Pierre, a Port St. Lucie, Fla., tax preparer, pleaded guilty today to wire fraud and aggravated identity theft, the Justice Department and Internal Revenue Service (IRS) announced. Pierre was charged with a scheme to file false federal income tax returns using stolen identity information.

According to the indictment and Pierre’s admissions in his plea, from October 2009 through May 2011, Pierre filed false tax returns for clients of Tax Max, a Port St. Lucie tax return preparation business he owned and operated. Pierre obtained the names and Social Security numbers of relatives of clients for whom he had prepared and submitted federal income tax returns and then fraudulently used those names and Social Security numbers as “dependents” on other client tax returns and on his own tax return. Inclusion of a dependent on a federal income tax return can result in a higher tax refund.

Sentencing has been set for July 2, 2012, before the Judge Donald L. Graham of the Southern District of Florida. Pierre faces a maximum potential sentence of 20 years in prison for the wire fraud count and a mandatory two-year sentence for the aggravated identity theft count. Pierre also faces up to $500,000 in fines and an order of mandatory restitution.

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Kevin P. Mahoney Sentenced to 60 Months in Prison for Tax Crimes and Contempt

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-529.html 

Kevin P. Mahoney of Attleboro, Mass., was sentenced today to 60 months in prison, following trial convictions on corruptly endeavoring to obstruct the administration of the Internal Revenue laws, filing false tax returns with the Internal Revenue Service (IRS) and criminal contempt of court, the Justice Department and the IRS announced. U.S. District Judge Joseph L. Tauro presided over the trial and imposed the sentence. A Boston jury convicted licensed stockbroker, insurance agent and financial advisor Mahoney on Jan. 25, 2012. Mahoney was charged with one count of corruptly endeavoring to obstruct the administration of the Internal Revenue laws, eight counts of contempt of court and eight counts of filing false tax returns. He was convicted on all counts. Judge Tauro also ordered Mahoney to pay $367,000 in restitution to the IRS. Mahoney was remanded to prison immediately following the sentencing hearing.

The evidence at trial showed that Mahoney had failed to pay all of his taxes for the years 1996 through 2001 but had attempted to pay tax-related debts by submitting to the IRS more than $2.2 million in fictitious financial instruments, called Bills of Exchange, and checks drawn on a closed bank account. The evidence further showed that Mahoney obtained fake Bills of Exchange from American Rights Litigators (ARL), a now-defunct Florida-based organization that was permanently enjoined from promoting and selling certain fraudulent tax schemes based on its prior promotion and sale of the same. ARL was also used by imprisoned actorWesley Snipes . After filing for bankruptcy, Mahoney caused a worthless promissory note made by now-deceased “sovereign citizen” Jerry Ralph Kane to be submitted to the IRS as purported payment for approximately $805,000 in taxes that Mahoney owed at that time.

The evidence also showed that Mahoney submitted to the IRS false individual income tax returns for the years 2000 through 2006 that he knew failed to report more than $1.3 million in taxable income received from various financial institutions. Along with his tax returns, Mahoney had submitted altered IRS Forms 1099-MISC on which he changed to zero the amount of non-employee compensation that the financial institutions had reported paying him. For instance, Mahoney attached to his 2006 tax return an altered Form 1099-MISC in which he claimed that a life insurance company paid him non-employee compensation of zero when it had actually paid him approximately $73,000. Mahoney also filed a false 2007 Nonresident Alien Tax Return in which he falsely claimed a refund of almost $389,000.

According to evidence at trial, the U.S. District Court for the District of Massachusetts had permanently enjoined Mahoney in July 2002 from, among other things, engaging in conduct that interfered with the administration of the Internal Revenue laws. The injunction proceedings were brought against Mahoney in accordance with a lawsuit filed by the Justice Department’s Tax Division. Mahoney committed criminal contempt by violating the permanent injunction in that he assisted in the preparation and submission to the IRS of income tax returns for other people that falsely claimed more than $50 million dollars in refunds based on false IRS Forms 1099-OID and an IRS Form 1099-C falsely reporting $300 million in debt purportedly owed to a third party by an IRS employee.

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Federal Court Bars Cathy and Lashanda Vinnett from Preparing Tax Returns

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-531.html 

A federal court in New Orleans has permanently barred Cathy and Lashanda Vinnett from preparing federal tax returns for others, the Justice Department announced today. The civil injunction order, to which the Vinnetts agreed without admitting the government’s allegations, was signed by Judge Helen G. Berrigan of the U.S. District Court for the Eastern District of Louisiana.

The government’s complaint alleged that Cathy Vinnett and her daughter Lashanda, both from Destrehan, La., and their companies – M&C Tax Service, D&C Tax Service, River Parish Tax Professionals and Remarkable Tax Services – prepared federal tax returns for customers claiming fraudulent tax refunds based on fabricated telephone excise tax refund claims, earned-income tax credits and first-time homebuyer tax credits. After claiming these improper refunds, the lawsuit alleged, the Vinnetts kept most of the resulting money for themselves, without telling their customers. The lawsuit alleges that the defendants’ misconduct caused as much as $2.2 million in harm to the government.

The court order also requires the Vinnetts to inform their customers of the order and to provide the government with a list of their customers since Jan. 1, 2007.

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Aristotle “Rick” R. Matsa Convicted of Tax Fraud and Obstruction of Justice Crimes

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-508.html 

The Justice Department and Internal Revenue Service (IRS) announced today that attorney Aristotle “Rick” R. Matsa, of Worthington, Ohio, was convicted of numerous tax fraud and obstruction of justice related offenses, including witness tampering and making a false statement. In addition, Rick Matsa and his mother, Loula Z. Matsa, were convicted of conspiracy to obstruct justice, commit perjury, and make false statements, following a five-week trial in Columbus, Ohio, before the Honorable Edmund A. Sargus Jr.

Rick Matsa individually was convicted of one count of a corrupt endeavor to obstruct and impede the IRS, 15 counts of aiding and assisting in the preparation of false and fraudulent tax returns, that related to five different trusts; one count of willfully failing to file a Report of Foreign Bank and Financial Accounts (FBAR); one count of conspiracy to obstruct justice, commit perjury, and make false statements; two counts of witness tampering; one count of submitting a false statement; and one count of obstruction of justice.

According to the indictment, which was returned on June 23, 2010, and the evidence admitted at trial, Rick Matsa, who in addition to being an attorney was also an architect, a real estate broker, and a licensed minister in Ohio, created and operated several nominee entities in order to disguise and conceal his income and assets from the IRS. The false trust return charges relate to filings for at least five separate trust entities during the tax years 2003 to 2005. In fact, the evidence at trial showed that the trusts had been filing similar returns dating back to 1990. Each of the trusts reported receiving significant amounts of interest income each year, generated from funds held in numerous bank accounts, yet no income tax was reported due as a result of fraudulently claimed deductions for distributions on the trust returns that were purportedly paid to a foreign beneficiary each year. However, the evidence at trial showed, instead, that Rick Matsa used funds from those trusts to purchase a 150-acre farm in Hocking County and a home in Worthington, both of which he used as a personal residence.

The evidence at trial also showed that Rick Matsa violated FBAR, the foreign bank account reporting requirements, by failing to disclose his ownership and control over a foreign bank account held in The Netherlands. The evidence at trial was that Rick Matsa maintained more than $300,000 in funds in that undisclosed foreign bank during 2003.

The evidence at trial further showed that after learning of the federal grand jury investigation into his business activities in May of 2006, Rick Matsa, together with Loula Matsa and others, conspired to obstruct the investigation by misleading and concealing evidence from the grand jury, making false statements to the grand jury, creating false documents, tampering with witnesses, and lying to federal investigators.

George Pappas, formerly an attorney in Urbana, Ohio, who previously pleaded guilty to making false statements to federal agents and during the grand jury investigation, testified at trial. Pappas testified that he falsely claimed ownership of Rick Matsa’s law firm, located in the Short North area of Columbus, in their efforts to withhold records from the grand jury.

Rick Matsa’s tenant, P. Maria Galloway, the owner of an art gallery next door to Rick Matsa’s law firm, also testified after pleading guilty to conspiracy to obstruct justice. Galloway testified that she signed numerous documents at Rick Matsa’s direction, including federal income tax returns for Rick Matsa’s law firm and a number of his nominee entities, which Rick Matsa used as part of his scheme to obstruct the IRS.

“Today’s verdict shows that attorneys and other professionals who violate the tax laws or who attempt to obstruct justice will be held accountable for their actions,” said Assistant Attorney General for the Tax Division Kathryn Keneally. “Those who illegally attempt to hide their income and assets from the IRS through fraudulent trusts or offshore bank accounts will be prosecuted and punished.”

“The government will not tolerate abusive tax schemes that use offshore accounts to illegally escape taxes,” said Rick A. Raven, Acting Chief, IRS Criminal Investigation. “Those Americans who file accurate, honest and timely tax returns can be assured that the government will hold accountable those who don’t.”

Rick Matsa faces a maximum potential sentence of 108 years imprisonment, a fine of up to $3.25 million, and five years of supervised release. Loula Matsa faces a maximum potential sentence of five years imprisonment, a fine of $250,000, and three years of supervised release. No sentencing date has yet been scheduled.

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Justice Department Seeks to Shut Down Five South Florida Tax Return Preparers

Source-  http://www.justice.gov/opa/pr/2012/April/12-tax-491.html 

The United States has sued to shut down five Florida tax return preparers, the Justice Department announced today. In the civil injunction complaint, filed in the U.S. District Court for the Southern District of Florida in Fort Lauderdale, Fla., the government alleges that since at least 2008, Jayvon Copeland, Kisha Andrews, James Daniels, Aundrea Luc and Brandon Johnson have knowingly understated their customers’ federal income tax liabilities and claimed improper tax refunds. The complaint states that the defendants reside in Broward and Miami-Dade County, Fla.

According to the complaint, the defendants fraudulently boosted tax refunds through false claims for the first-time-homebuyer tax credit, phony business expenses, false education expenses and fabricated income or withholdings that inflate a customer’s earned income tax credit. The lawsuit alleges that the defendants inflated customers’ tax refunds in order to extract exorbitant fees from the refunds.

The complaint also alleges that the defendants used stolen identities to prepare and file tax returns claiming fraudulent tax refunds, which the defendants kept. The complaint describes one instance involving a tax return prepared in the name of a man serving a life sentence in prison. According to the complaint, the return claimed a refund based on bogus education expenses and a fraudulent first-time-homebuyer credit. The prisoner allegedly did not know that a tax return was filed in his name.

The lawsuit also accuses the defendants of attempting to conceal their fraud by jumbling or falsifying various identification numbers that the Internal Revenue Service (IRS) requires tax return preparers to disclose on the returns they prepare. The defendants also allegedly established and operated a web of tax-preparation entities to perpetrate this fraud.

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