Gave at the office; mortgage and mining; rotten to the corps; and other highlights of recent tax cases.
Tallahassee, Florida: Preparer John Jean-Gilles, 34, of Midway, Florida, has been sentenced to 52 months in prison after pleading guilty to charges of aiding in preparing false returns, wire fraud and aggravated ID theft.
Between 2012 and 2016, Jean-Gilles, owner of the tax prep business USA Tax and Multi-Services, prepared and filed false federal returns for various individuals, falsely representing clients’ income, withholdings, credits and refunds due.
He was also ordered to pay $1,984,357 in restitution.
Fort Lee, New Jersey: Shope Oluwo, 35, has been sentenced to six years in prison for generating phony tax refunds using ID information stolen from current and former members of the U.S. Army.
From January through February 2016, Oluwo conspired with others, including Dermot Sutherland, 30, of Philadelphia, to obtain personal ID information stolen from current or former members of the U.S. Army. Oluwo used that information to create fake military ID cards and fraudulent W-2s bearing the victims’ names. Oluwo provided the phony cards and W-2s to Sutherland, who posed as the victims and filed phony returns with a tax prep company. Afterwards, Sutherland received debit cards from the prep company that contained the stolen refunds.
Oluwo was also sentenced to three years of supervised release and ordered to pay $11,170 in restitution.
Ithaca, New York: William Harrell, 58, has pleaded guilty to filing a false return.
Harrell admitted that he filed a return for 2015 in which he underreported revenue he received through his construction and remodeling business. He also admitted to underreporting revenue for the years 2012 to 2014 and 2016.
Harrell failed to report some $3,994,866 in income, avoiding $422,843 in federal income taxes, not including interest and penalties.
He faces up to three years in prison, a fine of up to $250,000 and up to a year of supervised release. Sentencing is June 16.
Portland, Oregon: Resident Mark Edward Staggs, 64, has been sentenced to six months in prison and two years of supervised release for filing a false federal return.
From 2009 through 2019, Staggs owned a used office furniture business and received all of his gross income from several large clients in Oregon and California, who paid him with checks.
Staggs would travel from Oregon to California to cash the checks at a check-cashing service; his use of a false Social Security number prompted the service to file currency transaction reports with the federal government’s Financial Crimes Enforcement Network. Staggs never deposited the cash into his business bank account or recorded it in his business records.
When the service began refusing Staggs’ checks, he enlisted two acquaintances to cash the checks on his behalf. Staggs encouraged these acquaintances to lie if anyone questioned them.
In total, between 2010 and 2013, Staggs failed to report nearly $500,000 of income, resulting in tax loss of $142,583.
Staggs, who pleaded guilty last year, was also ordered to pay more than $142,000 in restitution to the IRS.
Silver City, New Mexico: Accountant Thomas Laws, 62, has pleaded guilty to four counts of wire fraud and one count of aggravated ID theft in connection with a scheme to steal more than $1.5 million.
Laws worked as a licensed accountant and registered investment advisor, providing accounting, prep and investment services. From 2008 to 2019, he engaged in a scheme to obtain money by false pretenses and fraudulent misrepresentations made to clients, lenders, investors and others.
Among other things, Laws lied to two clients to convince them to invest in a real estate development project. Laws fabricated and forged mortgage documents purporting to show that $650,000 these clients invested in the project was secured by a mortgage. In reality, Laws had mortgaged the property to other lenders and then defaulted; a court had ordered foreclosure and judicial sale of the property. Rather than developing the real estate, Laws channeled the $650,000 to pay part of a settlement with an earlier victim of his scheme.
He also scammed two other investors out of $550,000 that he claimed would be used for a mining project. Laws used the money to pay off earlier victims of his scheme, including partial restitution to a corporation from which he, as the corporation’s CEO, had embezzled more than $1 million.
Laws made or caused others to make several wire transfers of funds. He also used stolen money to pay personal expenses for himself and his family, including credit card debt, travel, communication and media services, firearms and cash.
His scheme cost victims more than $1.5 million.
Laws faces up to 81 months in prison.
Trenton, New Jersey: Tony V. Russell, 49, of Stone Mountain, Georgia, a former employee of Tax Pro’s and Tax Solutions & Associates in New Jersey, has been sentenced to four years in prison for conspiring to defraud the U.S. by filing false income tax returns.
Two members of the conspiracy previously pleaded guilty to their roles in the fraud and await sentencing: Damien Askew, 39, of Union, New Jersey, and Rudolph Sanders, 41, of Newark, New Jersey. Conspirator Joseph Kenny Batts, 49, of Elkridge, Maryland, has been convicted in connection with the case and Angelo K. Thompson, 38, of Reistertown, Maryland, has also pleaded guilty.
From at least 2009 to April 2015, Batts was co-owner, along with Askew, of Tax Pro’s, a prep and payroll business where Russell, Sanders, Batts, Thompson and Askew prepared returns. To boost their business, the defendants conspired to falsify their clients’ federal income tax returns to inflate refunds.
The conspirators fabricated and inflated credits for education and child care, deductions such as charitable contributions and unreimbursed employee expenses and business losses. Russell and other members of the conspiracy also permitted Batts to use their PTIN as Batts had a prior federal tax fraud conviction.
After law enforcement began investigating Tax Pro’s in 2015, Batts discontinued that business and opened Tax Solutions and Associates where Russell, Thompson and Batts continued preparing false federal returns.
Batts, Askew, Thompson, Russell, and Sanders caused a total tax loss to the IRS of more than $900,000.
Russell was also sentenced to three years of supervised release and ordered to pay $241,185 in restitution.
