A wrong turn; from the people; busy lady; and other highlights of recent tax cases.
Las Vegas: Tax preparer Maria Magdalena Mendoza, 52, has been sentenced to three years in prison to be followed by a year of supervised release for fraudulently preparing and filing false income tax returns.
Beginning around 2013, Mendoza ran her own tax prep business under the names "Taxes & More" and "Taxs y Mas." She used false or inflated deductions and credits on tax returns filed on behalf of her clients and used their personal ID information to falsely obtain a larger refund on her own returns.
Mendoza, who
She also inflated clients' refund requests without their knowledge and stole the excess amount of those refunds. Through this scheme, Mendoza diverted more than $500,000 of her clients' refund payments into her own accounts from 2013 to 2017.
In March, while on pretrial release, Mendoza was arrested while in possession of a stolen passport, drivers' licenses and credit cards in the names of other individuals, as well as forged copies of checks.
Weldon Spring, Missouri: Business owner Jeffrey M. Bauza has been sentenced to 21 months in prison for using employees' tax money for college tuition and mortgage payments on two houses.
Bauza owned the truck-driving schools CDL Training Service & Consulting and CDL Training Services of Missouri. From 2012 to 2019, he failed to pay over income, Social Security and Medicare taxes from employee wages to the IRS.
Instead, he used part of the $2.3 million in withheld taxes for college tuition for one of his children and for mortgage payments on his home and a vacation home in Florida. He also failed to pay $1 million in employer contributions to the IRS.
Bauza, who pleaded guilty in November, must also pay back $1.4 million that he still owes in taxes.
Jackson, Mississippi: State Rep. Earle S. Banks Sr. has pleaded guilty to willfully making a false material statement on a federal income tax return.
Banks failed to report more than $500,000 of income from the sale of property. He admitted that he willfully failed to report that income to the IRS and that the U.S. Attorney's Office has sufficient evidence to convict him at trial if necessary.
Sentencing is Aug. 21. Banks faces a maximum of three years in prison.
St. Louis: Reality show cast member and local radio personality Brittish "Cierrah" Williams has pleaded guilty to 15 federal felonies and admitted committing tax fraud, bank fraud, insurance fraud and three separate pandemic frauds.
Williams admitted under-reporting her income on returns for 2017 to 2019 and falsely claiming a niece and nephew as dependents, avoiding $29,366 in taxes.
She fraudulently used Social Security numbers not assigned to her to open accounts with credit card companies and banks, which resulted in losses of $28,537 to those creditors. Williams also used those Social Security numbers to open bank accounts, then deposited thousands of dollars' worth of checks taken from other peoples' accounts without their knowledge and withdrew the money, causing another $23,850 in losses.
In addition, Williams admitted submitting nine applications for Economic Injury Disaster Loans, four applications for Paycheck Protection Program loans and one application to a rent relief program in California. Her disaster loan applications contained false information about business income and payroll, as well as her criminal history. She used the $144,400 in loans that resulted from two of the applications to fund her lifestyle. Williams also received $52,647 in PPP loans.
In January 2022, Williams applied for the California COVID-19 Rent Relief program, falsely claiming that she was a California resident with a total annual household income of $50,000 and that she couldn't pay her rent due to a "reduction in hours of work" due to the pandemic. She received $27,801.
Williams also submitted fake medical bills to at least one insurance company, resulting in $139,479.92 paid to her, co-conspirators or both.
Finally, Williams has not filed annual tax returns since her indictment in October 2021 and listed herself as "exempt" on a form with her current employer, resulting in no taxes being withheld from her $90,000 salary.
The total known actual and intended losses totals $446,082.
Sentencing is Aug. 23. The charges of misusing a Social Security number and making false statements each carry up to five years in prison and a $250,000 fine. The bank fraud charges carry penalties of up to 30 years in prison, a $1 million fine or both. The wire fraud charges carry a penalty of up to 20 years in prison and a $1 million fine.
Southfield, California: Tax preparer Lori Bradford, 55, has pleaded guilty to 10 felonies in connection with filing false returns for clients, according to published reports.
Bradford prepared and filed returns with false statements and false claims for refunds by inflating withholding amounts. She also provided bogus W-2s and other supporting documents to the Michigan Department of Treasury when it questioned the returns and attempted to verify their accuracy, authorities told news outlets.
Bradford, who pleaded guilty, had initially been charged with 43 crimes related to falsifying returns for at least 15 persons, reports said, adding that several of those charges were dismissed by the Oakland County Prosecutor's Office. Sentencing is Sept. 7, reports said.
Kansas City, Missouri: Patrick Scot Witcher, of Wichita Falls, Texas, a former agent for the Drug Enforcement Administration and a former Kansas City, Missouri, police officer, has pleaded guilty to filing a false federal income tax return as part of a payday loan scheme.
Witcher assisted at least five Kansas City-area individuals with establishing and managing payday lending enterprises. He admitted that he filed false federal tax returns that included more than $1 million in unreported income between 2016 to 2018 from such an enterprise, the operations of which purportedly occurred outside of the U.S. and then on Native American reservations. In reality, most functions of the enterprise were based in the Kansas City area.
Witcher faces up to three years in prison.
Orlando, Florida: Mortgage loan officer Jeffrey Donaldson has pleaded guilty to evading his federal income taxes.
Between 2015 and 2018, he worked for two mortgage companies and made more than $750,000 in wages. To each of his employers he submitted false W-4s, claiming that he was exempt from any federal income tax withholding. During that same period, Donaldson did not file personal returns. He caused a tax loss to the IRS of more than $150,000.
He faces a maximum of five years in prison, as well as a period of supervised release, restitution and monetary penalties.
Key West, Florida: Business owner Batyr Myatiev has been sentenced to 32 months in prison for conspiring to defraud the U.S. and conspiring to harbor aliens and induce them to remain in the country.
Between November 2010 and October 2020, he owned and operated several area staffing companies that facilitated employment of non-resident aliens in hotels, bars and restaurants operating in Key West and elsewhere. Myatiev encouraged workers to enter the U.S. illegally and induced them to remain in the country, in violation of immigration laws. His companies paid alien workers without withholding federal income and employment taxes from their wages and did not report those wages to the IRS.
Myatiev was also ordered to serve three years of supervised release and pay some $6,869,869.80 in restitution to the United States.
