Archive

June 29, 2018

A former CEO of a software company in Sterling, Virginia, was sentenced to 21 months in prison for conspiring to defraud the government by failing to pay over employment taxes announced the Justice Department’s Tax Division. According to court documents, Robert Lewis was the CEO of Enterworks, Inc., a software company in Sterling, Virginia. From January 2011 to February 2013, Lewis conspired with Kristie McDonald, Enterworks’ Vice President of Finance and Administration, to defraud the United States by failing to pay over to the IRS more than $1.8 million in payroll taxes withheld from employee paychecks. As part of their scheme, Lewis and McDonald circumvented the company’s normal payroll and accounting procedures by paying some employees with manual paychecks. The employees still received the correct pay after withholdings, but by bypassing the accounting system, Lewis and McDonald were able to hide the fact that the withholdings were not being paid over to the IRS. DOJ

June 29, 2018

A Newington, Connecticut, insurance salesman was sentenced to 70 months in prison for tax fraud, announced the Justice Department’s Tax Division. Terry DiMartino was convicted after a jury trial in March 2016 of one count of corruptly interfering with the due administration of the internal revenue laws, two counts of filing false tax returns and five counts of willfully failing to file tax returns. DiMartino was an insurance salesman for numerous insurance companies located in Connecticut and elsewhere. According to the evidence presented at trial, DiMartino attempted to obstruct the IRS by mailing false documents to the IRS, including three false tax returns for the 2007 tax year, one of which requested a fraudulent $14 million refund. He sent false and threatening correspondence to the IRS in an attempt to defeat the IRS’s assessment, collection and investigative efforts. DOJ

June 22, 2018

Tax preparers Joseph Racine and Arnouse Merlien pled guilty to conspiracy to violate the Internal Revenue Code by falsely claiming tax credits and deductions for their clients. Racine and Merlien defrauded taxpayers of over $3.5 million. The investigation showed that Racine and Merlien improperly claimed the tax credits and deductions for their clients to increase the amount of fees they could charge their clients. USAO NDGA

June 22, 2018

Joseph Racine and Arnouse Merlien, two Atlanta-based tax preparers, have pleaded guilty to conspiracy to violate federal tax laws by misrepresenting to the IRS that their clients were qualified to receive certain credits and deductions. The misrepresentations caused $3.5M in lost tax revenue for the US. USAO Northern District of Georgia

June 18, 2018

Gina Holley, a Tennessee-based tax preparer, pleaded guilty to filing false claims with the IRS. According to the charges, Holley improperly claimed that tax payers were entitled to fuel tax credits, resulting in a loss of over $400k of tax revenue. USAO Western District of Tennessee

June 6, 2018

Utah financial advisor Henry Brock was sentenced to 72 months in prison for marketing and selling fraudulent a tax-avoidance and investment strategy to clients, and causing his clients to file false tax returns; over an eight year period, Brock promised investors his “IRA Exit Strategy” would allow them to avoid paying tax on IRA withdrawals. The scheme caused investors to lose over $10 million, and resulted in more than $1 million in tax losses. USAO DUT

June 6, 2018

Jaquon Mucsarney was sentenced to 12 years in prison for devising a scheme in which he created roughly 50 fake businesses for which he filed fictitious U.S. corporate income tax returns; Mucsarney used stolen names and social security numbers to obtain EIN numbers for some of the businesses, he used his own, his wife’s, and his mother’s SSNs for others. From 2011 to 2016, Mucsarney fraudulently claimed more than $2 million in refunds and ultimately collected more than $300,000. USAO DCO

April 3, 2018

John Anderson Rankin, who owned a software company and a number of restaurant and entertainment businesses in Circleville, Ohio, was sentenced to five months in prison and ordered to pay restitution of $7.1 million for failure to account for and pay over employment taxes to the IRS and other tax charges.  DOJ

February 15, 2018

A Massachusetts temporary employment agency operator pleaded guilty in Boston federal district court to an indictment charging him with conspiring to defraud the government, failing to pay over employment taxes and obstructing the internal revenue laws. According to the indictment and statements provided in Court, Tien Chau ran an employment agency that provided temporary labor to businesses in Massachusetts and New Hampshire. The agency operated under at least four different names: Central Boston Staffing Services, Metro Boston Staffing Services, General Staffing Inc. and Kim’s Staffing Inc. Chau and others used nominees to conceal their ownership of the business. From 2006 through 2011, Chau and others conspired to conceal the agency’s total number of employees from the Internal Revenue Service (IRS) to lower the staffing agencies’ employment tax liabilities. Chau attempted to hide the size of their workforce from the IRS by paying most of the employees cash under the table and filing false employment tax returns that both underreported the number of employees and omitted wages paid in cash. Chau and others in the conspiracy allegedly cashed over $11 million in client checks at a check cashing facility in Worcester and used the staffing agency’s site supervisors, office manager and drivers to pay the employees in cash. DOJ