Some of our favorite recent tax fraud cases.
Peabody, Mass.: Preparer Barry Ginsberg, 63, has pleaded guilty to multiple counts of mail and wire fraud, preparing false tax returns and obstructing the IRS in connection with defrauding small-business clients out of nearly $900,000 that his clients had given him to pay federal payroll taxes.
Ginsberg, indicted in May 2013, owned and operated a payroll tax business that had a number of “escrow” clients. Ginsberg prepared their payroll tax returns; these clients also regularly sent him money to pay payroll taxes to the IRS. Instead, Ginsberg took the money and used it for other business or personal reasons. The defendant’s clients, some of whom trusted him for years, racked up significant arrearages with the IRS.
To cover up his scheme, Ginsberg falsified clients’ returns, indicating that the payroll taxes had been paid in full. When asked by clients about their mysterious IRS debts, Ginsberg gave them a litany of false excuses, including blaming the IRS and his own staff.
Sentencing is Sept. 28. The mail and wire fraud charges carry a maximum of 20 years in prison, three years of supervised release and a fine of $250,000 or twice the total gain or loss, whichever is greater. The maximum for the tax-related crimes are three years in prison, one year of supervised release and a fine of $100,000.
Bigfork, Mont.: Former preparer Leilani Louise Albertson, 29, has received a five-year sentence after stealing money from a customer, according to published reports.
Albertson reportedly worked as a seasonal tax preparer for a nearby Liberty Tax office. News outlets said the theft was spotted when a customer told police that $4,777 was transferred to an account owned by Albertson. The customer recognized the name because she had prepared his taxes weeks before.
The theft reportedly took place in March and Albertson was charged in early April; she was fired from Liberty Tax after the arrest. At the time of the theft, she was reportedly on probation for a conviction of felony for issuing a bad check. Another case for deceptive practices was moving through the courts, reports added.
Albertson was sentenced in all three cases, reports said, adding that Liberty Tax didn’t run a background check on Albertson prior to hiring her. The local office owner reportedly said that Albertson didn’t disclose her criminal history on her job application.
Chicago: Melvin Reynolds, 63, a former member of the U.S. House of Representatives, has been indicted on federal charges alleging that he failed to file income tax returns for the years 2009 through 2012.
According to the indictment, Reynolds received gross income in each year in excess of the minimum amount required to file a tax return and willfully failed to file income tax returns for four consecutive years. Each count of failing to file a federal income tax return carries a maximum of one year in prison and a $250,000 fine.
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