The daughters of the patriarch of an income tax preparation business were sentenced to six years in federal prison for filing false tax returns after their father received a 10-year sentence.
Karen Denise and Carla Denine Berry each received six-year prison sentences along with three years of supervised release. They were also ordered to pay $14 million in restitution to the IRS.
Their father, Matthew Carl Berry, a Rialto, Calif., tax return preparer, was previously sentenced to 108 months in federal prison and 36 months on supervised release. He was also ordered to pay over $15 million in restitution to the IRS after he was convicted on charges that he conspired with others to defraud the IRS and filed false personal income tax returns for the years 2001, 2002 and 2004.
Karen and Carla Berry pleaded guilty before the trial to various charges, including conspiracy to defraud the IRS, aiding and assisting in the preparation of false tax returns, and subscribing to a false tax return.
According to prosecutors, Matthew Berry operated the tax business out of his home in Rialto from around 1995 through 2003. Beginning in early 2000, his daughters began preparing false income tax returns at the business. In 2002, two employees who have also been charged in the case, Ivan Taylor Johnson and Valerie Madel Dixon, began helping prepare the false returns as well. In 2004, the business relocated to a commercial building in Rialto and the Berrys formed N.C.K. Services, Inc., to operate the tax business.
According to the Berry sisters plea agreements, their father controlled the cash paid by clients. He would typically pay each preparer weekly, in cash, based upon the number of returns the preparer had completed during the prior week. He would deposit large amounts of cash he received from clients into bank accounts to avoid arousing the suspicions of bank employees. The Berrys also used the money to purchase cashiers checks in their own names and those of third parties, depositing the checks into bank accounts which they controlled.
The false returns are estimated to have caused losses of more than $45 million in tax revenue to the IRS.
