Tax Fraud Blotter: Family affairs
International sex crimes and tax fraud; boxed in; bad Solutions; and other highlights of recent tax cases.
Orlando, Fla.: Preparer Andy William Bosch, 43, has been sentenced to 16 years and eight months in prison for enticement of a minor to engage in sexual activity and for federal income tax fraud.
According to court documents, in March 2016, Bosch, who has pleaded guilty to both charges, enticed a minor to travel from the Philippines to the U.S. to engage in sexual activity. Then from October 2016 to February 2017 he used a cellphone to coerce the same minor to engage in sexual activity.
Both independently and as part of his federal prep business, BBG Tax Services, Bosch helped prepare and file fraudulent federal income tax returns from 2012 to 2017. The losses for the false returns charged in the indictment totaled $135,801.
Camas, Wash.: Preparer Paula Odia, 44, who now lives in Vancouver, Wash., has been sentenced to a month in prison for assisting in filing false tax documents.
Prosecutors said Odia prepared nearly 80 fraudulent returns, resulting in a tax loss to the U.S. that the government estimates is $254,191. Most of Odia’s clients were unaware she had falsified their returns or that she directed a portion of their refund to her bank account or to accounts belonging to members of her family.
According to case records, between 2011 and 2016 Odia prepared federal income taxes for customers from her Camas home. In 2011, she began claiming illegitimate deductions and credits in her clients’ returns then diverted a portion of that refund to bank accounts that she or members of her family controlled. Odia’s copies of the returns to clients did not reflect what she actually filed with the IRS.
Odia, who pleaded guilty in October, agreed to pay $254,191 in restitution to the U.S. Treasury; she was also ordered to one year of supervised release to follow the prison term.
Farmington, Mich.: Arshawn Kenard Hall, president of a truck-hauling business, has pleaded guilty to wire fraud and to willfully failing to file a return.
According to information presented in court and filed documents, Hall operated the truck-hauling business RAMA Enterprise and was hired to transport plastic crates filled with automobile parts on behalf of an automobile company. After transporting the parts, Hall was expected to return the empty crates to a facility in Detroit. Instead, Hall diverted these plastic crates and sold them to a plastic recycling company for approximately $460,000. The actual value of the plastic crates that Hall stole was approximately $2.9 million.
Hall failed to file a 2012 federal income tax return on behalf of RAMA and failed to pay the taxes due. The tax loss associated with the crime is $142,069.
Sentencing is November 29, when Hall faces a maximum of 20 years in prison for his wire fraud conviction and a year in prison for failing to file a return. He also faces a period of supervised release, restitution and monetary penalties.
Vallejo, Calif.: Porsha Dickens, 44, has pleaded guilty to conspiring to submit false claims for federal refunds.
According to court documents, from March 2011 through March 2013 Dickens and co-defendant Dionna Bradshaw conspired to submit false returns to the IRS by obtaining the personal ID information of others and then submitting returns seeking refunds to which the people listed on the returns were not entitled.
To pursue the refunds, false statements were placed on the returns regarding employers, income, withholding from income and eligibility for certain tax credits, among other things. The employers listed on most of the fraudulent returns were companies purportedly belonging to Dickens; the fraudulently obtained tax refunds were frequently directly deposited into the bank accounts of Dickens and Bradshaw.
Refunds claimed in connection with the conspiracy totaled more than $300,000.
Sentencing is October 23. Dickens faces a maximum of 10 years in prison and a $250,000 fine. Bradshaw previously pleaded guilty and awaits sentencing.
Collinsville, Va.: Pharmacist Jerry R. Harper Jr., 61, has pleaded guilty to failing to account for and pay over employment taxes.
According to court documents, Harper owned and operated the Family Discount Pharmacy chain in several Virginia towns. From 1998 through 2014, FDP accrued employment tax liabilities of more than $5 million. Harper withheld these taxes from FDP employees’ wages but did not pay the taxes to the IRS.
In more than 15 years, Harper filed only one employment tax return with the IRS. He admitted that instead of providing the employment taxes to the IRS, he caused FDP to pay his personal expenses.
For example, Harper wired more than $1 million to his personal bank account, made more than $500,000 in stock market investments, spent more than $100,000 on his son’s pharmacy school tuition and purchased more than $370,000 of real property in Virginia and North Carolina. Harper also used part of the money to purchase a Jeep Grand Cherokee and a Jet Ski.
Sentencing is October 26. Harper faces a maximum of 10 years in prison, a period of supervised release, restitution and monetary penalties.
Trenton, N.J.: Preparer Tony V. Russell, 47, of Stone Mountain, Ga., and a former employee of Tax Pro’s and Tax Solutions & Associates prep businesses in Essex and Union Counties, N.J., has admitted to conspiring to defraud the U.S. by filing false income tax returns.
Two members of the conspiracy previously pleaded guilty to their roles in the fraud and await sentencing. Damien Askew, 39, of Union, N.J., pleaded guilty in June 2017 to conspiracy to defraud the IRS and filing a false federal personal income tax return. Rudolph Sanders, 41, of Newark, N.J., pleaded guilty in May to conspiracy to defraud the IRS. Two other members of the conspiracy were arrested in April.
According to documents filed in this and related cases and statements in court, from at least 2009 to April 2015 the defendants conspired to falsify clients’ federal income tax returns to generate refunds from the IRS in amounts that their clients were not entitled to. They inflated refunds by fabricating and inflating credits for education and childcare, deductions such as charitable contributions and unreimbursed employee expenses and business losses.
Russell and other members of the conspiracy also permitted others to use their PTIN to conceal the identity of the actual preparer, who had a prior federal tax fraud conviction.
After law enforcement executed a search warrant at Tax Pro’s in April 2015, Tax Pro’s closed and the defendants opened Tax Solutions and Associates in Union and continued preparing false federal returns.
The five caused a total tax loss to the IRS of some $900,000.
The conspiracy charge carries a maximum of five years in prison. The aiding and assisting in the preparation of a false return charge and the filing a false return charge both carry a maximum of three years. All offenses carry a fine.
Russell’s sentencing is November 29.
Johnson City, N.Y.: Preparer Lavyette Garcia, 41, has received two years in prison and been ordered to pay $72,452 restitution to the U.S. Treasury following her guilty plea to preparing false federal income tax returns and making false claims against the U.S.
Garcia pleaded guilty and acknowledged that from 2011 to 2014 she prepared and filed 110 phony federal returns for others. These returns included fictitious income levels and falsely claimed eligibility for tax credits to qualify for refunds totaling $848,196.
The IRS identified some of the returns as containing false information and halted some refunds. In many cases where refunds were issued, Garcia kept as much as half of the refunded money.
She was also ordered to serve three years of supervised release following her prison sentence.