Tax Fraud

August 24, 2018

Executives of Utah-based biodiesel company Washakie Renewable Energy, and another individual associated with NOIL Energy Group in California, were indicted for falsely claiming over $500 million in renewable fuel tax credits. The individuals allegedly created false production records and other paperwork to make it appear that fuel transactions that qualified for the tax credit were occurring.  The indictment also included allegations of money laundering.  DOJ

July 27, 2018

Mirelis Holding S.A., a Swiss financial and asset management firm, entered in to a non-prosecution agreement with a penalty of $10.25 million.  Mirelis also agreed to cooperate with U.S. investigations in to its U.S. clients who used Mirelis to conceal assets and evade U.S. tax obligations.  DOJ

July 23, 2018

Jenelle Robyn Pinkston has been sentenced to three years in prison ordered to pay $63,338 in restitution for her involvement in a scheme to fraudulently obtain income tax refunds.  Pinkston filed 143 fraudulent tax refunds in 2012 resulting in refunds totaling $403,615.00. USAO MDTN

July 12, 2018

A Collinsville, Virginia pharmacist pleaded guilty to failing to account for and pay over employment taxes, announced the Justice Department’s Tax Division. According to court documents, Jerry R. Harper, Jr., 61, owned and operated Family Discount Pharmacy, Inc. (FDP) in Stanleytown, Virginia, with multiple locations in Stuart, Rocky Mount, Chatham, and Brosville, Virginia. As owner of FDP, Harper was responsible for collecting and paying over FDP’s employment taxes. From 1998 through 2014, FDP accrued employment tax liabilities of more than $5 million. Harper withheld these taxes from FDP employees’ wages, but did not pay the taxes to the Internal Revenue Service (IRS). In over 15 years, Harper only filed one employment tax return with the IRS. DOJ

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