Tax Fraud Blotter: Fuel For Fraud
Bogus W-2s; dependents, complete with numbers; underreporting supplemental money; and other highlights of recent tax cases.
Carney’s Point, N.J.: Marilyn Crespo, 50, has pleaded guilty to one count of filing a false corporate tax return for tax year 2009, admitting that she signed false returns for shell companies resulting in $286,742 in fraudulent refunds.
According to the case documents and statements court, Crespo previously resided in Guttenberg, N.J., and at the direction of her husband, Jose Crespo, signed numerous corporate returns knowing that the businesses were not real and that the credits claimed were false.
She also took advantage of federal fuel excise tax credits, signing a federal corporate return for 2009 for Magnum Cleaning Service Corp. that claimed gross receipts of $115,027, a fuel excise tax credit of $20,859 and a resulting refund of $15,750. In fact, Magnum was a shell company and the gross receipts and fuel excise tax credit numbers were false. Marilyn Crespo received and cashed the $15,750 refund check at a check-cashing facility in Guttenberg. She cashed many other refund checks for similar false returns at this same check-cashing facility.
Jose Crespo pleaded guilty on Sept. 11 to engaging in the fuel excise tax credit scheme and another tax fraud and to causing an anticipated loss to the IRS of nearly $1.5 million. He was sentenced Dec. 20 to three years in prison.
The count of filing a false tax return carries a maximum of three years in prison, and a potential $250,000 fine or twice the gross gain or loss from the offense. Marilyn Crespo’s sentencing is June 20.
Grand Rapids, Mich.: Sara Dechaune Harper (formerly Sara Dechaune Chatmon), 42, of Lawrenceville, Ga., and Amika Diane Gordon, 41, of Lansing, Mich., have each been sentenced to 18 months in prison for their roles in a conspiracy to defraud the IRS. The two were also ordered to pay back $199,263 stolen from the U.S. Treasury.
A federal grand jury indicted Harper and Gordon in 2017 and charged both with conspiracy to defraud the U.S., a five-year felony.
The indictment alleged that Harper and Gordon, along with other co-conspirators, agreed to file fraudulent corporate returns with the IRS between 2010 and 2014. The defendants were accused of creating sham business entities that sought fraudulent tax credits for fuel that was never purchased or used by those businesses.
Evidence proved that the conspirators filed 35 false corporate returns on behalf of 10 different companies that fraudulently sought more than $360,000 in federal tax refunds. The IRS detected 13 of the fraudulent returns before issuing refunds; the fraud resulted in $199,263 in refunds being issued.
Both defendants, in addition to serving their prison sentences and three years of supervised release, must repay the entire loss to the U.S. Treasury.
Corpus Christi, Texas: CPA Brian Perez, 34, has entered a guilty plea to wire fraud and tax evasion.
Perez, now of San Antonio, admitted that while working as a bookkeeper he orchestrated the fraudulent transfer of funds from his employer’s bank account to his personal tax withholding account. Perez also admitted that he filed a false income tax return and requested a refund of the overpayment.
Through this scheme, Perez defrauded his employer of $162,775 between March and August, 2015.
Sentencing is July 18, when Perez faces up to 20 years in prison for wire fraud and a maximum of three years for tax evasion. Both charges also carry a $250,000 maximum fine.
Pahrump, Nev.: Walter Fabian Guzman, 39, has received 25 months in prison for his role in a $290,000 income tax return fraud conspiracy and for violation of his supervised release.
Guzman, who previously pleaded guilty, was also ordered to pay $290,364 restitution to the victims.
According to the plea agreement, Guzman admitted that from January to August 2010 he conspired with co-defendants Felix Guzman and Judas Godina to submit false income tax returns for clients. He recruited clients by promising large refunds on their individual income tax returns.
Guzman and others also submitted false W-2s that reported additional income and withholdings, and Schedules E that falsified business losses.
Newport News, Va.: Neivda Hicks, 33, has been sentenced to 54 months in prison for filing false returns and ID theft.
According to court documents, Hicks prepared and filed returns for at least 53 individuals in exchange for payment from 2013 through 2016. In addition to the information that these individuals provided, Hicks would include in returns materially false information to reduce the tax due and inflate the refunds.
Hicks falsely claimed that her clients had incurred qualifying education expenses, as well as business profits and losses through falsely claimed periods of self-employment. She also falsely identified members of her own family and inmates then incarcerated with her husband as dependents of those for whom she prepared returns. She also failed to identify herself as a paid preparer on the returns.
Hicks included similarly false information in her own returns for tax years 2012 through 2015. In total, Hicks filed at least 32 materially false income tax returns on behalf of herself and others, requesting more than $200,000 in federal refunds. Of this amount, more than $150,000 derived from the materially false information she had included in returns.
Salt Lake City: Former executive Peter Nordberg, 62, of Alameda, Calif., has been sentenced to a year and one day in prison for tax evasion.
According to court documents, Nordberg, who pleaded guilty in September, was the CEO of Max International, a company that produces and markets nutritional supplements directly and through independent associates and distributors. Nordberg earned a salary and commissions equal to a percentage of sales.
He had Max International pay his bonus income to a nominee entity he established, and used a bank account in the name of the nominee entity to pay personal expenses. Nordberg then concealed the bonus income and nominee entity from his preparer and filed federal returns that underreported his income.
Nordberg’s conduct caused a tax loss of approximately $275,000.
He was also ordered to serve a year of supervised release and to pay $354,770 restitution to the U.S. Treasury.
Newberry, Fla.: Business owner Mac Johnson, 50, has pleaded guilty to tax fraud, wire fraud, structuring financial transactions to evade reporting requirements and harboring undocumented aliens.
Johnson, who owns roofing, tree service and dumpster businesses, devised a scheme to conceal the amount of wages earned by his undocumented alien employees to avoid paying more than $1.7 million in federal income, Medicare and Social Security taxes, as well as more than $1 million in Florida worker’s compensation premiums.
He concealed the wages from the state by inaccurately and incompletely identifying all employees, representing that lower wages were paid than the true amounts and paying by cash or a non-payroll check in amounts of less than $10,000.
Investigators discovered that undocumented alien employees on work sites did not speak English or have any personal identification. Their names did not match the names on the insurance policy and their files contained employment eligibility verification forms that did not match their handwriting. Johnson also provided transportation to the work sites and rented residences he owned to the undocumented workers for which he deducted money from their pay.
Failure to collect and pay over taxes carries a maximum of five years in prison, wire fraud a maximum of 20 years, and structuring and harboring undocumented aliens a maximum of 10 years each. Sentencing is May 29.