Bank jobs; meet me in the lobby; get Reals; and other highlights of recent tax cases.
Anaheim, California: Former chamber of commerce exec Todd Ament of Orange, California, has pleaded guilty to multiple charges involving defrauding a cannabis company, fraudulently obtaining a COVID-relief business loan worth nearly $62,000, lying to a bank while seeking a loan for a $1.5 million second home and for cheating on taxes.
In 2019, Ament served as president and CEO of the Anaheim Chamber of Commerce, where he and a political consultant who was a partner at a national public relations firm devised a scheme to divert proceeds intended for the chamber through the PR firm and into Ament’s personal bank account. Ament and the consultant schemed to defraud a cannabis company that had retained the political consultant to lobby for legislation in Anaheim.
The cannabis company paid $225,000 to the chamber with the understanding that it would have access to a task force that crafted such legislation, but at least $41,000 of that money was paid directly to Ament without those payments being disclosed to the client.
In April 2020, Ament applied to the Small Business Administration for an economic injury disaster loan on behalf of his company, TA Consulting, a sole proprietorship that had no substantial operations or employees. The SBA wired Ament $61,900 as EIDL proceeds; Ament used the money to pay for various personal expenses, including at clothing stores and boat dealers and on property taxes for his home.
That December, Ament lied to JPMorgan Chase, falsely representing that three deposits from the PR firm to Ament-controlled bank accounts — totaling $205,000 — were earned income based on services provided by TA Consulting LLC on the PR firm's behalf. In fact, Ament knew the $205,000 represented a loan to himself and was not earned income.
For tax years 2017 through 2019, he caused false returns to be signed and filed that did not report income he had received from various sources. In July 2019, his federal return reported that his gross receipts for 2018 were $0 when his actual receipts were $179,336. In total, Ament caused a federal tax loss of $249,998 for those three tax years.
Sentencing is Dec. 9.
Corpus Christi, Texas: Tax preparer Jeannette Villarreal and her two daughters, Leannette Villarreal and Zeannette Salazar, have admitted to conspiring to commit tax fraud.
The three prepared and filed income tax returns for clients under the business name of J&G Armadillo’s Tax Service, a.k.a. Reals Tax Service. They each admitted to one count of conspiracy to defraud the U.S.by willfully aiding and assisting in the preparation of false income tax returns.
On numerous occasions, they reported inaccurate earnings, fictitious charitable contributions and improper tax credits to inflate refunds.
Sentencing is Oct. 6. All three face up to three years in prison and a $250,000 fine.
Little Rock, Arkansas: Four women, all sisters, have pleaded guilty to defrauding the U.S. Department of Agriculture out of more than $11.5 million that was intended to benefit farmers who had been discriminated against.
Lynda Charles of Hot Springs, Arkansas; Rosie Bryant of Colleyville, Texas; Delois Bryant of North Little Rock, Arkansas; and Brenda Sherpell of Gainesville, Texas, each pleaded guilty to conspiracy to commit mail fraud and to defraud the IRS.
They admitted that from 2008 until 2017 they solicited people to file false claims that they were discriminated against when they tried to get assistance from the USDA for farming operations. The sisters also admitted that they hired a tax preparer to falsify returns, resulting in failure to report more than $4.6 million to the IRS. That preparer, Jerry Green,
The defendants submitted claims related to two matters: the Black Farmers Discrimination Litigation settlement and the Hispanic and Women Farmers and Ranchers claim program. Both suits resulted in a claims process where a successful claim resulted in an award of $62,500. Of that, $50,000 would be payable to the claimant and $12,500 transferred directly to the IRS as a withholding.
The sisters were involved with 192 claims, almost all of which were successful, resulting in a loss of more than $11.5 million. The claims were false because the claimants had not suffered discrimination and, in most cases, had not even attempted to farm. The money received from a claim was income that should have been reported on the claimant’s tax return. The sisters and Green admitted that Green provided tax preparation services for the claimants they had recruited and that Green falsified the returns to create a refund.
Three of the sisters — Lynda Charles and Rosie and Delois Bryant — filed false returns of their own and used money from the conspiracy to buy numerous homes and other real properties, a van and a Mercedes.
Chicago: Attorney Patrick D. Thompson has been sentenced to four months in prison for false statement and tax offenses in connection with funds he received from the failed Washington Federal Bank for Savings.
From 2011 to 2014, Thompson, who was convicted in February, received $219,000 from Chicago-based Washington Federal via a purported loan and other unsecured payments. He made one repayment on the loan but then stopped making payments and failed to pay interest on the funds he received. Washington Federal was shut down in 2017.
When the FDIC tried to obtain repayment from Thompson in 2018, he falsely stated that he owed only $110,000 and that those funds were for home improvement. Thompson knew he had received $219,000 in three separate installments — none of which went towards home improvements — and that $110,000 of it was paid by the bank directly to Thompson’s law firm.
The tax charges stemmed from Thompson falsely representing on five years of income taxes that he was entitled to a mortgage interest deduction for interest payments made on money he received from Washington Federal.
Charlotte, North Carolina: Tax preparer Joseph Octave has been sentenced to 41 months in prison for conspiring to defraud the U.S. by preparing and filing false returns.
Octave, who previously
Octave also trained his employees to create the fraudulent returns to avoid IRS detection and provided them with scripts and cheat sheets. He also told employees not to give clients copies of their own returns and not to share with the clients any details beyond the total refund amount. In many instances the clients were unaware of how much they were being charged.
Kapital earned at least $700,000 in fees for preparing the fraudulent returns; Octave received the largest share of this income. The conspiracy caused a total tax loss of more than $2.5 million.
Octave was also ordered to serve two years of supervised release and pay some $2.5 million in restitution to the United States.
