Tax Fraud Blotter: Official problems | #employeefraud | #recruitment | #corporatesecurity | #businesssecurity | #

Serious misStep; the taxman goeth; extra checks, please; and other highlights of recent tax cases.

McKees Rocks, Pennsylvania: David Francis, 69, owner and operator of a prep business and of Next Step Recovery Housing, a purported drug rehabilitation center, has pleaded guilty to conspiracy to distribute 100 grams or more of heroin. He also waived prosecution by indictment and entered a plea of guilty to a five-count information charging him with assisting in the filing of fraudulent federal income tax returns.

While operating Next Step, Francis conspired to distribute heroin with suppliers from New York from November 2016 through February 2017. During the same time, he was also the owner and operator of the prep business All Personal Matters. Through that, he aided in the preparation and filing of fraudulent returns on behalf of clients, resulting in a loss to the IRS of $1,681,607.54.

Sentencing is Nov. 4. For the drug charge, the law provides for a sentence of five to 40 years, a fine of not more than $5 million, or both. For the tax charges, the law provides for a sentence at each count of not more than three years and a fine of not more than $250,000.

Edgeworth, Pennsylvania: Dean Britton, who worked in the New York City real estate industry, has pleaded guilty to tax evasion.

After Britton was contacted by the IRS regarding unfiled returns from 2013 to 2017, he delinquently filed several years of returns reporting that he owed more than $1.1 million in outstanding taxes. Britton evaded taxes by placing the title to his personal residence in a nominee name, using business bank accounts to pay his personal expenses and directing income into new personal bank accounts he established after the IRS levied his prior account.

During these years, Britton spent more than $1.46 million on personal expenses, including approximately $770,000 on real estate purchases, $240,000 in home rentals, $96,000 in home renovations, $74,000 in travel, $65,000 in country club expenses and $50,000 in private school tuition.

Sentencing is Nov. 5, when he faces a maximum of five years as well as a period of supervised release, restitution and monetary penalties.

Washington: Vincent Slater, 42, of Temple Hills, Maryland, and a former official of the District of Columbia Office of Tax and Revenue, has pleaded guilty to participating in corruption schemes in which he accepted at least $75,000 in exchange for fraudulently erasing tax liability, inflicting more than $3 million in losses on the district.

Investigation into Slater’s schemes — which to date has resulted in the guilty pleas of two taxpayers and the indictment of two taxpayers and another former district government employee — began in 2017 when internal auditors from the Office of the Chief Financial Officer noticed suspicious adjustments to certain taxpayers’ accounts.

Between 2012 and 2017, Slater brokered bribery agreements with various bar and nightclub owners through a former employee of the D.C. Department of Consumer and Regulatory Affairs. Slater then used his position as a manager in OTR’s Adjustment Unit to fraudulently eliminate or reduce the tax liabilities of their businesses or otherwise act to fraudulently benefit bribe-paying taxpayers. Slater admitted to causing a total loss of more than $3 million to the district.

Slater explained that typically he and others agreed to solicit bribe payments equaling approximately half of the amount the taxpayer sought to evade paying, and then to split the bribe. Slater further admitted that $75,000 in cash deposits he made into his bank accounts during the scheme were bribe proceeds.

Slater’s plea marked the second time in two weeks that former district tax officials have pleaded guilty to bribery.

Slater faces as much as 108 months in prison. A sentencing date has not been set.

San Antonio: Preparer Richard Medina Sr. has pleaded guilty to the preparation of federal income tax returns that contained fraudulent deductions and to making a false statement in U.S. bankruptcy proceedings.

Medina operated an unnamed and unregistered prep business out of his residence from 2013 to 2016. On returns he prepared and submitted to the IRS, Medina included false credits and itemized deductions; he further admitted that he produced more than 30 fraudulent returns for others and four personal returns for a total loss to the U.S. government of $273,372.

Prior to 2013, Medina and his wife filed for bankruptcy protection under Chapter 13. Medina admitted that he failed to report to the U.S. Bankruptcy Trustee income derived from his prep business since 2013. Medina also admitted that he made false statements to the Social Security Administration omitting his income derived from his prep business to obtain Social Security disability benefits he would not have otherwise received.

Medina faces up to three years in prison and restitution to the IRS for the false tax return charge and up to five years in prison for making a false statement in U.S. bankruptcy proceedings. Sentencing is Sept. 16.

Jonesboro Arkansas: Former accountant Edward Cooper, 71, of Mammoth Springs, Arkansas, has been sentenced to five years in prison for bank fraud after stealing more than $9 million from a client.

Cooper worked as an accountant with the firm of Osborn & Osborn and handled a number of financial affairs for Roach Manufacturing Corp. in Trumann, Arkansas. Beginning in approximately 1996, when he prepared dividend distribution checks and tax checks for Roach, Cooper requested extra checks and then made them payable to himself.

He took approximately 138 unauthorized checks from 1996 through 2018, totaling more than $9 million. In the fall of 2017, Roach hired a financial manager who detected the fraud, leading to the criminal case.

Cooper, who pleaded guilty in January, was also sentenced to two years of supervised release and ordered to pay $7,401,744.82 in restitution.

Upland, California: Mohammad R. Tirmazi, a public official in Los Angeles County’s Internal Services Department, has been sentenced to a year and a day in prison for accepting nearly $300,000 in bribes from an electrical contractor and then failing to report the income he received from those bribes and a side business on his federal returns.

Tirmazi accepted a total of $299,707 in bribes from a vendor that performed low-voltage electrical wiring for the county. In exchange, Tirmazi approved change orders for work that did not occur and materials that were not used on county projects. He also did not report code violations in the work and formed a separate company to process checks that were sometimes paid as bribes.

Tirmazi failed to report on his tax returns for years 2014 to 2016 a total of $355,107 of income he received from bribe payments and a side business selling IT equipment.

Tirmazi, who pleaded guilty in May 2019, was also ordered to pay $420,010 in restitution to the County of Los Angeles and the IRS.

Source link

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Leave a Reply

Shqip Shqip አማርኛ አማርኛ العربية العربية English English Français Français Deutsch Deutsch Português Português Русский Русский Español Español

National Cyber Security Consulting App







National Cyber Security Radio (Podcast) is now available for Alexa.  If you don't have an Alexa device, you can download the Alexa App for free for Google and Apple devices.