Tax Fraud Blotter: Rotten to the Corps
Crown capers; with a bullet; using the jailed; and other highlights of recent tax cases.
Houston: Preparer Fatai Adeniji, owner of Crown Financial Services, has entered a guilty plea to aiding and assisting in preparing false returns.
He admitted that from 2012 through 2016 he prepared returns for clients that contained false income, false expenses, false education credits and false Earned Income Credits. From 2013 through 2015, Adeniji prepared and filed false returns for himself that omitted most of his earned income from tax prep and that claimed false education credits.
Sentencing is Oct. 4, when Adeniji faces up to three years in prison and a $100,000 fine.
Blooming Grove, N.Y.: Contractor Daniel McInerney, 48, has been sentenced to more than seven years in state prison for weapons possession, felony tax evasion and defrauding customers of his home improvement business.
Authorities said local police had received numerous complaints that McInerney had accepted payment in connection with multiple home-improvement projects and failed to substantially complete the jobs or deliver materials that were to be purchased for the projects. Investigation also revealed that he had failed to pay his personal income taxes for 2010 in an amount in excess of $3,000, and for 2013 in an amount in excess of $1,500.
A search of McInerney’s home later resulted in the seizure of multiple loaded firearms, ammunition and business records.
Boca Raton, Fla.: Former resident Wilson Lasset, 48, who purported to operate a prep business in Pompano Beach, Fla., has been sentenced to more than five years in prison for multi-million-dollar stolen-ID refund fraud.
Lasset, who previously pleaded guilty, received 42 months on the wire fraud count, to be followed by a consecutive term of two years in prison for aggravated ID theft.
According to case records and facts presented in court, Lasset applied to the IRS for identification numbers, enabling him and the business he incorporated, Triangle International Training Center, to prepare and e-file returns on behalf of others. In 2012, using these identification numbers, he filed approximately 1,606 federal returns that included at least 25 returns filed using the names and Social Security numbers of individuals living with cerebral palsy who did not need to file returns and who did not authorize Lasset to file tax returns on their behalf. The unauthorized filings also included returns using the IDs of some 386 incarcerated individuals.
These returns included falsely claimed EITCs based on false claims of earning income as “household help” employees, and falsely claimed education credits.
Lasset’s ID numbers were used to claim more than $2.7 million in fraudulent refunds; the IRS paid approximately $788,611 in refunds based on these returns. Approximately $51,000 was deducted directly from these refunds as prep fees deposited into a bank account Lasset opened and controlled for Triangle International. Lasset used the money to fund travel and other personal expenses.
Fort Lee, N.J.: Shope Oluwo, 33, has admitted generating phony refunds using personal information stolen from U.S. soldiers.
According to case documents and statements in court, in early 2016 Oluwo conspired with others, including Dermot Sutherland, 29, of Philadelphia, to obtain personal information stolen from current or former members of the U.S. Army.
Oluwo used that information to create fake military ID cards and fraudulent W-2s bearing the victims’ names. He provided the phony cards and W-2s to Sutherland, who posed as the victims and filed phony returns with a prep company.
Afterwards, Sutherland received debit cards from the prep company that contained the stolen refunds.
Conspiracy to commit wire fraud carries a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. The access device fraud charge carries a maximum of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense. Aggravated ID theft carries a two-year term that must run consecutively to any other prison term.
Oluwo’s sentencing is Oct. 26. Sutherland previously pleaded guilty and awaits sentencing.
Nashville, Tenn.: Jenelle Robyn Pinkston, 50, of Corvalis, Ore., and formerly of Nashville, has been sentenced to three years in prison for her involvement in a scheme to fraudulently obtain income tax refunds.
According to case documents and evidence, Pinkston filed 143 fraudulent returns over 10 months in 2012 while acting as an independent preparer for a Nashville-area prep service. Pinkston filed the returns on behalf of clients of the service and also used the IDs of prison inmates, without their knowledge, to file false and fraudulent returns.
The fraudulent returns resulted in refunds totaling $403,615.00, which Pinkston directed to two bank accounts under her control; she caused an actual loss of more than $63,000 to the IRS.
Pinkston, who pleaded guilty in January, was ordered to serve three years in prison and two years of supervised release and to pay $63,338 in restitution to the IRS. She also received a forfeiture money judgment of $3,185.
Baltimore: Two local preparers have pleaded guilty to filing false returns.
Michael Anegbode, 29, of Windsor Mill, Md., operated MK Tax Service. He pleaded guilty to three counts of filing false income tax returns and was ordered to pay $48,808 in restitution and serve three years on probation. Uwagbale Oigbokie, 39, of Baltimore, operated Jovan Tax Service. He pleaded guilty to two counts of filing false returns and was ordered to pay $81,712 in restitution and serve two years on probation.
Both prepared and filed personal income tax returns that failed to reflect fees earned by filing false tax returns on behalf of numerous paying clients. Many of the returns filed on behalf of their clients included false information to fraudulently minimize the taxpayers’ Maryland tax liabilities and inflate refunds.
Waterbury, Conn.: Preparer Michael Mir, 41, has been sentenced to 20 months in prison, followed by a year of supervised release, for preparing false returns and underpaying his own federal taxes.
According to court documents and statements in court, Mir prepared more than 3,300 federal returns for the 2012 through 2015 tax years through a prep practice he operated. Mir falsified information on numerous returns that he prepared for clients by fabricating business expenses or by inflating deductible medical and dental expenses.
For the 2012 through 2014 tax years, he deposited more than $400,000 in income generated by his prep business into his personal bank account. Mir did not report any income from his prep business on his 2013 personal income tax return; he reported only $18,500 in income from his prep business on his 2014 return. Mir did not file a personal income tax return for 2015.
Through his preparation of false returns and underpayment of his own taxes, the government lost $406,679. In March, he pleaded guilty to one count of aiding and assisting in the filing of a false tax return.
He was ordered to make full restitution to the government. The IRS is taking action to recover unpaid taxes from Mir’s clients and his restitution figure will be reduced as money is recovered from his clients. He was also ordered by Judge Shea to perform 75 hours of community service during his supervised release.
Ashburn, Ga.: Preparer Markeith Smith, 36, has been sentenced to two years in prison after previously pleading guilty to wire fraud based on filing false federal returns. He was also ordered to pay $518,145 in restitution to the IRS.
Police executed a search warrant at Smith’s residence and recovered identifying information for approximately 121 people and approximately 40 TurboTax or GreenDot cards in the names of people who did not reside at Smith’s address. IRS officials analyzed the ID information and determined that approximately 352 false returns had been filed using that information, claiming refunds totaling more than $1 million, of which actual refunds were issued totaling $518,145.
Smith’s email user ID was used to file many of those returns. All people interviewed by IRS investigators whose personal ID information was found at Smith’s house said that they were victims of ID theft, the returns filed in their names were fraudulent, they had received no refunds from those returns and they hadn’t authorized Smith to file returns on their behalf.