Three New York residents, including one former IRS employee, have been indicted in federal court for defrauding the U.S. government by filing false claims for millions in false refunds.
Charged in a 20-count indictment are Clive Henry, of Jamaica, N.Y., a former IRS employee in the business of preparing tax returns; Rodney Chestnut, of Middle Island, N.Y., a retired New York City Department of Corrections officer; and Nafeesah Hines, a former U.S. Food and Drug Administration employee, also of Jamaica.
The defendants are each charged with one count of conspiracy to defraud the government, 11 counts of assisting in the preparation of false returns and four counts of filing false returns. Hines and Chestnut are each charged with one additional count of filing false returns.
Henry and Chestnut were arrested on January 15 and appeared in federal court in Brooklyn.
According to the indictment, between 2008 and 2012 the three recruited clients into a scheme attaching fake 1099-OIDs to returns that falsely claimed refunds of taxes never paid to the IRS. The false refund claims listed in the indictment total more than $3.4 million.
According to the indictment, the defendants collected fees based on a percentage of the false refunds that they claimed. The indictment also charges the defendants with filing false income tax returns for themselves as part of the scheme.
In 2013, a federal court permanently barred Hines and Chestnut from promoting an alleged tax fraud scheme involving thousands of false returns and from preparing returns for others.
If convicted, the defendants each face a maximum of five years in prison for conspiracy and a maximum of three years in prison for each false return charged against them, in addition to possible fines and restitution.
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