Some of our favorite recent tax fraud cases.
Sun Prairie, Wis.: Preparer Brenda Miller, 43, has been sentenced to a year and a day in prison and two years of supervised release and been ordered to pay $291,245 restitution for filing false returns.
Miller, who pleaded guilty on May 29, prepared more than 40 fraudulent returns designed to inflate refunds. Some of the returns improperly claimed that the filer had household help income and some claimed an improper number of dependents.
Authorities said that at sentencing she was reluctant to accept responsibility and deflected blame for her actions onto family members and the people for whom she filed returns.
Springfield Township, Pa.: Preparer and accountant William J. Frio, 59, has been sentenced to five years in prison for his role in a tax evasion scheme involving the restaurant chain Nifty Fifty, as well as evasion of his own taxes, structuring of funds he embezzled from the organization, and loan fraud.
Frio provided services to Nifty Fifty’s beginning in 1986. He and five others, including the restaurant chain’s owners and managers, participated in a long-running scheme to avoid paying millions of dollars in personal and employment taxes, failing to properly account for more than $15 million in gross receipts.
Frio and the owners and principals of Nifty Fifty used skimmed cash to pay themselves and people and businesses who supplied goods and services to the restaurants, providing those persons and businesses with the opportunity to evade the payment of their own taxes.
In 2008, Frio submitted a false loan application to a local bank for a $417,000 mortgage for his personal residence. He also submitted to the bank bogus federal income tax returns for 2006 and 2007 and bogus W-2s, falsely representing that he had earned substantial income from a firm named Tanfasia Inc., when he knew that the 2006 and 2007 returns that he submitted to the IRS showed far less income than the returns supplied to the bank, as well as knowing that he hadn’t been employed by Tanfasia in those two years.
Between January 2009 and November 2009, Frio knowingly structured transactions with the bank, totaling more than $2.6 million, as part of a pattern of illegal activity involving transactions of more than $100,000 in 12 months. Frio used his position as Nifty Fifty’s accountant to embezzle millions of dollars.
He pleaded guilty on Jan. 26 to conspiracy to commit tax evasion, four counts of filing false tax returns, loan fraud and aggravated structuring of financial transactions. He was also ordered to pay $1.7 million restitution and a special assessment of $700 and to serve four years of supervised release.
Grand Rapids, Mich.: Local resident Yashica Toshian Tucker, 40, has pleaded guilty to making a false claim against the U.S. government.
Tucker was charged in April in a 10-count indictment that alleged she prepared and filed false federal tax refund claims between January 2011 and February 2013. The indictment alleged false claims totaling $71,606. Tucker pled guilty to one of those counts.
According to case documents, Tucker claimed to be a “knowledgeable and experienced” preparer who filed federal income tax returns for others for a fee. She admitted preparing and filing a false tax return in 2011 on behalf of an individual filer whose return falsely stated that the filer earned more than $16,000 of income in 2010 and sought a refund of $7,436. Tucker made up the income amount.
Tucker successfully obtained the fraudulent refund from the government from that claim, of which she received $1,000. She further admitted that this was not the only time she knowingly filed a false and fraudulent federal return claiming a refund for another person.
Sentencing is Nov. 3, when she faces a maximum sentence for filing a false claim against the U.S. government of up to five years of imprisonment and three years of supervised release, as well as a fine of $250,000 or twice the gain or loss resulting from the offense and mandatory restitution to the government.
Tucker has agreed to be permanently barred from preparing or filing federal tax returns for anyone other than herself.
Utica, N.Y.: Elaine Monique Zavalla-Charres, 34, of Winslow, Ariz., has been sentenced in connection with her convictions for mail fraud and aggravated ID theft involving false returns that cost the IRS more than $400,000.
Charres was sentenced to serve six years in jail: 48 months for mail fraud and a consecutive term of 24 months for aggravated ID theft. She was also sentenced to three years of supervised release following prison and was ordered to pay $411,309 restitution.
Her scheme occurred in 2011 through 2013, when she and conspirator Lacey Hollinger, 27, of Massena, N.Y., contacted Massena area residents via Facebook and other electronic media to tell them they were eligible for a refund as part of a U.S. “stimulus program,” even though they were unemployed and had no income. No such program existed.
Several dozen persons responded, giving Hollinger their personal ID information. Hollinger forwarded this information to Charres, who used it to create false and fraudulent returns that, with others obtained from Arizona residents, generated over $400,000 in refunds.
The Massena area residents never saw the returns, which falsely represented that they were self-employed and entitled to a refund. Some received pre-paid debit cards that Charres mailed to them. Many got nothing, with Charres and Hollinger keeping most of the refund money.
In May 2013, IRS agents searched a former residence of Charres in Phoenix and found a computer used to create and file the fraudulent returns and numerous other documents in the scheme.
Hollinger was sentenced on May 22 to three years in prison and three years of supervised release, and was also ordered to pay restitution.
Philadelphia: Preparer Dauda Koroma, 43, who reportedly listed foster and disabled kids as dependents on clients’ phony returns and defrauded the IRS out of millions of dollars, has been sentenced to seven years and 10 months in prison.
Koroma, a citizen of Sierra Leone who worked at Medmans Financial Services in southwest Philadelphia, was one of nine persons charged in the case, according to published reports. He reportedly pleaded guilty in October to conspiracy, filing false returns, fraud and aggravated ID theft.
Authorities also had evidence that Koroma this year, even after pleading guilty, prepared a return for a client using someone else’s name as the preparer, news outlets said, adding that earlier this year Koroma, under oath, denied doing so. He reportedly admitted this crime too at his sentencing.
He was also reportedly ordered to serve three years of supervised release after prison and to pay $39,895 in restitution.
