Tax Fraud Blotter: Well-dressed thieves
Reaching across the Isle; room disservice; game of tag; and other highlights of recent tax cases.
New Orleans: Preparer Trish Christopher, of Metairie, Louisiana, has been sentenced to three years of probation for aiding and assisting in the preparation of false federal returns.
Christopher admitted that as owner and operator of C.C. Tax Service she prepared and caused to be prepared at least 36 individual income tax returns that included false or fictitious Schedule A deductions to inflate clients’ refunds.
She has agreed to pay $195,205 in restitution to the IRS. She was also ordered to pay a $100 special assessment fee.
Christopher’s crime is punishable by up to three years in prison.
Houston: Attorney Jack Stephen Pursley has been sentenced to two years in prison for conspiring to defraud the U.S. and for tax evasion.
Pursley was convicted in September of conspiring with a client to repatriate more than $18 million in untaxed income that the client had earned through his company, Southeastern Shipping. Pursley knew that the client had never paid taxes on these funds so Pursley designed and implemented a scheme to transfer the untaxed funds from Southeastern’s business bank account, in the Isle of Man, to the U.S. Pursley helped to conceal the movement of funds from the IRS by disguising the transfers as stock purchases in U.S. corporations owned and controlled by Pursley and his client.
Pursley received more than $4.8 million and a 25-percent ownership interest in the co-conspirator’s ongoing business for his role in the scheme. In 2009 and 2010, Pursley evaded assessment of and failed to pay the taxes he owed on these payments by, among other means, withdrawing the funds as purported non-taxable loans and returns of capital. He used the money for investments and to purchase personal assets, including a vacation home in Vail, Colorado, and property in Houston.
He was also ordered to serve two years of supervised release and to pay some $1,788,753 in restitution to the U.S.
Prairie Village, Kansas: Joel Jerome Tucker, described by authorities as a “well-dressed thief,” has pleaded guilty to engaging in two separate schemes related to millions of dollars in fake payday loan debt and to tax evasion totaling more than $8 million.
Tucker, working through various companies, serviced payday loan businesses. His company names changed over the years; the primary company was eData Solutions. eData, formally registered on July 29, 2009, did not make loans directly to borrowers; it collected loan application information, referred to as leads, and sold those leads to its some 70 payday lender clients. As a loan servicer, eData also provided software for payday lenders. Tucker and the other owners of eData sold the company to the Wyandotte Indian tribe in 2012.
Despite selling his interest in eData, Tucker maintained a file of 7.8 million leads containing detailed customer information. He also obtained data regarding defaulted payday loans eData had acquired from a number of different payday lender clients.
Tucker used these files to create falsified debt portfolios. He admitted that he engaged in a fraudulent debt scheme from 2014 to 2016. This scheme involved marketing, distributing and selling false debt portfolios. Tucker defrauded third-party debt collectors and millions of individuals listed as debtors through the sale of falsified debt portfolios. Tucker received as much as $7.3 million from the sale of false debt portfolios. Tucker also admitted that he executed a related bankruptcy fraud scheme in 2015.
For tax years 2014 through 2016, neither Tucker personally nor any of his companies filed federal returns. He told IRS agents that he had no income and was living on borrowed money. Tucker actually used nominee bank accounts to conceal income and assets, and spent hundreds of thousands of dollars in personal living expenses such as vehicles, chartered jets, travel and entertainment and a residence. Tucker also submitted a form to the IRS in which he omitted listing as an asset his membership in the Vail Mountain Club, for which he received $275,000 in 2016.
Tucker must pay $8,057,079.95 in restitution to the IRS, plus a forfeit to the government of $5,000 in connection with transferring stolen proceeds across state lines. He is also subject to up to 20 years in prison without parole.
Newport News, Virginia: Preparer Angela C. Harper has pleaded guilty to aiding and assisting in the preparation of a false return.
Harper owned At Ease Tax Services, which she operated from her home and hotel rooms locally. Between 2014 and 2018, she falsified returns by claiming fraudulent credits and deductions on behalf of her clients to inflate clients’ refunds. Harper did not sign these returns as the paid preparer; she also did not provide copies of the returns to clients even when they requested them.
Sentencing is Jan. 4. Harper faces a maximum of three years in prison, as well as a period of supervised release, restitution and monetary penalties.
Atlanta: Gerald D. Harris, 51, a former supervisor in the DeKalb County Tax Commissioner’s Office, has pleaded guilty to accepting bribes to unlawfully register vehicles and then trying to blackmail a bribe payer by threatening to inform on her to the FBI.
The Motor Vehicle Division of the DeKalb County Tax Commissioner’s Office handles all aspects of motor vehicle registrations. From July 2017 to November 2019, Harris served as the supervisor of tax tag clerks, overseeing clerks who processed motor vehicle registrations and renewals.
From approximately mid-2018 to November 2019, Harris accepted at least $30,000 in bribes from customers to unlawfully register vehicles or renew vehicle registrations. He was fired on Nov. 18, and soon after attempted to blackmail one of the individuals who had been paying him bribes.
Guilford, Connecticut: Accountant Louis DeMaio has pleaded guilty to tax evasion and obstruction offenses.
DeMaio was employed as an accountant in East Haven, Connecticut, and from approximately 2010 to 2018 also operated Almatt LLC, a temporary employment agency that provided day laborers to construction companies. Although DeMaio listed another individual on paper as the owner of Almatt, he effectively owned and ran it.
As part of Almatt's operating procedures, it invoiced construction companies for the cost of labor provided and, from the payments received from the companies, paid the employees. Almatt and DeMaio then provided the employees with W-2s reflecting that Almatt had made required federal tax withholdings. Almatt and DeMaio in fact failed to withhold taxes and subsequently failed to pay over those withholdings to the IRS. Almatt also never filed yearly income tax returns or quarterly 941s.
He also issued checks from Almatt made out to himself and to family members who did not work at the business. From 2010 through 2018, DeMaio and his family received more than $2.5 million from the company; DeMaio failed to report any of these distributions on his federal personal income tax returns.
In 2015, the IRS initiated a civil examination of Almatt, and then expanded the examination to evaluate the completeness of DeMaio’s personal income tax returns. When the IRS confronted DeMaio about his failure to report income paid to him by Almatt, DeMaio fabricated a story that a substantial portion of the payments he received from Almatt were loan repayments from the supposed owner. DeMaio provided an IRS revenue agent and other investigators with a false notarized document to support his story.
The tax loss is $1,132,398. DeMaio has agreed to pay full restitution, as well as interest and penalties. He pleaded guilty to one count of tax evasion, which carries a maximum sentence of five years in prison, and one count of obstructing and impeding the due administration of Internal Revenue laws, which carries a maximum of three years. Sentencing is Nov. 3.