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Ala. Defendants Sentenced in Stolen ID Refund Scheme

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Montgomery, Ala. (September 24, 2012)

By Jeff Stimpson

Three defendants involved in a stolen identity refund fraud scheme have been sentenced in the Middle District of Alabama, according to the Department of Justice.

Chiquanta Davis received a prison term of 66 months, her husband Terrence Davis was sentenced to 18 months in jail and Laurekshia Blakely received a six-month prison sentence. All three were also sentenced to three years’ supervised release.           

In May, the three had pleaded guilty to various charges in a superseding indictment: Chiquanta Davis to conspiracy to file false claims, theft of public funds and aggravated identity theft; and Terrence Davis and Blakely each to one count of theft of public funds.

According to court documents, Ms. Davis operated a sham tax business in 2010 called It’s Tax Time out of her home. She opened a bank account in the name of It’s Tax Time and directed a total of $1,458,600 in fraudulent refunds to that bank account.

Although the IRS intercepted and stopped many of the refunds, Ms. Davis still received a substantial amount into the account, using the funds, among other things, to buy a Cadillac Escalade that she has agreed to forfeit as part of her plea agreement.   

Court records also say that in 2011, Ms. Davis assisted with the filing of 192 false returns requesting $769,223 in refunds, with those refunds then directed to various bank accounts, including accounts controlled by her husband and Laurekshia Blakely. Fraudulent refunds totaling $199,959 from 54 false tax returns were directed to Terrence Davis’s bank accounts, and $24,314 from five false tax returns were directed to Laurekshia Blakely’s accounts.

3 Comments

Yes, these offenders certainly deserve whatever punishment is meted out to them. The larger question, however, is whether the new IRS initiative to put many tax preparers out of business will actually accomplish what it's designed to do. I suspect that many of these fraudulent preparers could actually pass the IRS's test and continue as registered tax preparers, under the radar of the new IRS initiative. Meanwhile, many honest preparers may not be able to pass the IRS test, and will leave the industry. As a consequence, tax prep fees will rise as there are fewer paid preparers in the business, taxpayers will switch to self-prepared returns via purchased software (e.g., Turbo-tax), and errors of other types will begin popping up.

Posted by: janejohn | September 25, 2012 10:32 AM

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I agree with djb. Identity theft and fraudulent preparers are a serious problem and the IRS are asleep at the switch. They were stealing my and your tax money and I take offense to that. They should make examples of these people to deter others.

Posted by: timblackcpa | September 25, 2012 8:26 AM

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The punishment certainly doesn't look like it fits the crime! Flogging by those who's ID were stolen seems like a more realistic punishment!!! djb :~))

Posted by: DJBradach | September 25, 2012 7:40 AM

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