A roundup of our favorite recent tax fraud cases.
Memphis, Tenn.: Preparers Jeremy Blanchard, 35, and Erik Pittman, 35, have been sentenced to prison for conspiring to defraud the U.S. and aiding and assisting in the preparation of false returns.
Blanchard received 70 months in prison and three years of supervised release; Pittman received 33 months in prison to be followed by a year of supervised release. They were also ordered to pay $549,000 restitution to the IRS.
According to court documents, Blanchard and Pittman were partners in the tax prep business Mo Money Taxes, which operated three locations in the Richmond, Va., area. Blanchard, Pittman and others prepared numerous false returns for their clients for the 2011 tax year. They admitted that they created and inflated fictitious and fraudulent tax credits, including the EITC and the American Opportunity Credit, to claim undeserved refunds for customers.
Blanchard and Pittman admitted that their conduct caused a loss to the IRS of between $250,000 and $550,000.
Another participant in this scheme, Corey Taylor, 25, of Richmond, was sentenced in March to 20 months in prison for one count of conspiracy to defraud the U.S. and one count of aiding and assisting in the preparation of a false return.
Stillwell, Kan.: Preparer Richard Drake, 60, has pleaded guilty to one count of aggravated ID theft and one count of theft of government funds, admitted that he stole more than $2 million from the IRS by filing false tax returns in the names of his clients and directing the refunds into accounts that he controlled.
In his plea agreement, Drake admitted that he used the IDs of his clients without their knowledge. Also as part of his plea agreement, Drake has agreed to serve 48 months in prison and to pay $2,432,147 in restitution to the IRS.
Luling, La.: Preparer Kali Irons, 39, of Luling, has pleaded guilty to one count of filing a false return.
According to court records, Irons, a self-employed preparer, under-reported her taxable income for 2009 and 2010 to the IRS, resulting in a tax loss to the U.S. of $88,203.
She faces up to three years in prison, up to $100,000 in fines and up to one year of supervised release. Sentencing is September 1.
Elizabeth City, N.C.: Preparer Geraldine Zaler, 60, has been arrested and faces charges that she embezzled more than $13,000 from her former employer more than a decade ago, according to published reports.
News outlets said that Zaler operates the tax prep business The Tax Lady and was arrested on the embezzlement charge during a traffic stop for speeding. According to the warrant for her arrest, Zaler is reportedly accused of embezzling more than $13,000 from the Jackson Hewitt business in Elizabeth City in 2004.
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