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November 26, 2019

Volunteer Income Tax Assistance Return Preparer Indicted for Scheme to Receive False Tax Refunds [1]

On October 1, 2019, in the Southern District of Texas, Brian Washington was charged in an 18-count indictment with making false statements on an income tax return, theft of Government money, and aggravated identity theft. Washington was subsequently arrested in connection with the charges.

According to the indictment, from January 2015 through April 2018, Washington owned and operated several tax preparation businesses. During two tax filing seasons, he worked as a Volunteer Income Tax Assistance (VITA) return preparer. The VITA program is a nationwide initiative sponsored by the Internal Revenue Service (IRS) to provide help with income tax filing to low and moderate income people. Washington took taxpayer return information from the VITA locations to prepare and file taxpayers’ returns from his residence, without proper authorization.

Washington prepared the tax returns using false Schedules A, false Schedules C, false earned income tax credits, and/or false child and dependent care credits. Washington used false information to request larger refunds than the amount to which the taxpayer was entitled. He then paid the taxpayers the refund they expected and kept the portion that had been falsely claimed. Washington did not sign the returns as the preparer, but instead falsely used the names of others. The investigation showed that Washington filed approximately 258 tax returns in the course of this scheme, claiming refunds totaling $1,196,871.

Additionally, Washington knowingly transferred, possessed, and used one victim’s name, date of birth, and Social Security Number in relation to the theft of Government money.

If convicted, Washington could be ordered to forfeit all property which constitutes, or is derived from, proceeds traceable to these offenses. He could also face a sentence of ten years’ imprisonment relative to the theft counts, three years’ imprisonment for making false statements on tax returns, and a mandatory sentence of two years’ imprisonment for the aggravated identity- theft count.

  • [1] The facts in this case narrative come from the following publicly available documents: S.D. Tex. Indict. filed Oct. 1, 2019; and S.D. Tex. Crim. Docket as of Oct. 16, 2019.


  • IRS Employee Charged in Connection with Misusing Victim Identities to Commit Credit Card Fraud [1]

    On October 2, 2019, in the Eastern District of Virginia, Kwashie Senam Zilevu was charged via criminal complaint with access device fraud. Zilevu was subsequently arrested by special agents of the Treasury Inspector General for Tax Administration (TIGTA) on October 3, 2019.

    According to the criminal complaint, Zilevu is currently employed as an Information Technology Specialist with the Internal Revenue Service (IRS). Between January 2016 and February 2018, Zilevu knowingly, and without authorization, used the names, addresses, dates of birth, and Social Security Numbers of at least three victims to obtain fraudulent credit cards. For example, one victim’s personally identifiable information (PII) was used to open an American Express credit card account on which $49,000 in fraudulent charges were made. Among the purchases were an airline ticket for travel from Washington, DC, to Miami, Florida, and a hotel reservation, both in Zilevu’s name.

    A second victim’s PII was used to open a U.S. Bank and Trust credit card. Bank statements revealed that a total of $10,273.39 in completed transactions and $2,651.62 in attempted transactions were made using this card. Included in the purchases was an airline ticket in Zilevu’s name from Dulles, Virginia, to Montego Bay, Jamaica. A third victim’s PII was used to open a U.S. Bank and Trust credit card, which was mailed to Zilevu’s address. A total of $9,641.69 in fraudulent charges were made using the third victim’s card. An official review of Zilevu’s IRS e-mail account further revealed that Zilevu received an e-mail message from PayPal congratulating the third victim for setting up his or her account and instructing the victim to click a link in order to confirm the accuracy of his or her e-mail address. Zilevu received a subsequent e-mail message at his IRS e-mail account from PayPal advising the third victim that he or she was officially a PayPal member. When interviewed, each of the victims confirmed that the fraudulent credit cards were opened in their names, and that Zilevu did not have permission or authority to use their information to apply for the cards.

    This investigation was worked jointly by special agents from TIGTA and the United States Postal Inspection Service. If convicted, Zilevu could face a fine and up to 15 years’ imprisonment.

    • [1] The facts in this case narrative come from the following publicly available documents: E.D. Va. Crim. complaint filed Oct 2, 2019; and E.D. Va. Executed Arrest Warrant Filed Oct. 3, 2019.


    • Florida Tax Preparer Sentenced for Aiding and Abetting in Theft of Internal Revenue Service Funds [1]

      On August 21, 2019, in the Northern District of Florida, Kenneth Alexander was sentenced for aiding and assisting in the preparation of a false and fraudulent return, aiding and abetting in theft of Government funds, and aggravated identity theft. Alexander was indicted for the offenses in July 2018 and pled guilty in April 2019.

      According to the indictment, Alexander was the sole shareholder of Wizard Business Center, a tax preparation business located in Tallahassee. Between 2012 and 2016, Alexander assisted in the preparation of Federal income tax returns that contained fraudulent and false material, specifically, Schedule A itemized deductions, Schedule C losses, Schedule E losses, and marital status. Alexander then stole and converted to his use, and the use of another, more than $1,000 of Internal Revenue Service (IRS) funds. In doing so, Alexander utilized a Florida Bar number of another individual, without lawful authority.

      Alexander was sentenced to 30 months’ imprisonment for aiding and assisting in the preparation of a false and fraudulent return and aiding and abetting in theft of Government funds, to be served concurrently, and to an additional 24 months’ imprisonment for aggravated identity theft, to be served consecutively, followed by three years of supervised release. Alexander was further ordered to pay $1,057,753.40 in restitution to the IRS.

      • [1] The facts in this case narrative come from the following publicly available documents: N.D. Fla. Indict. filed July 10, 2018; N.D. Fla. Plea Agr. filed Apr. 1, 2019; and N.D. Fla. Judgment filed Aug. 30, 2019.


      • Las Vegas Business Owner Indicted for Scheme to Obtain Money from the Internal Revenue Service [1]

        On September 11, 2019, in the District of Nevada, a superseding indictment was filed charging King Isaac Umoren with wire fraud, impersonating a Federal agent, aggravated identity theft, aiding and abetting, and the preparation of false tax returns, as part of a scheme for Umoren to obtain money from the Internal Revenue Service (IRS) by filing false tax returns claiming fraudulently inflated refunds paid through a Refund Advantage program.

        According to court documents, Umoren owned and operated a tax preparation business called Universal Tax Services (UTS), which had offices in Las Vegas, Nevada. UTS offered retail tax preparation services from at least 2013 through 2016, and Umoren usually charged his clients a return preparation fee ranging from $250 to $500. Umoren required clients to electronically sign agreements related to their returns, which allowed him to fraudulently collect additional money from their tax refunds. Umoren did not tell his clients he was collecting additional money from their tax refunds ranging from $700 to $1,100.

        The tax returns Umoren filed for his clients contained false statements and deductions designed to obtain the largest possible tax refund, and he concealed from the clients the false nature of the filed returns. Umoren electronically filed his clients’ tax returns from his offices in Las Vegas, Nevada, to IRS Processing Centers outside the state of Nevada. He also used the names and Preparer Tax Identification Numbers (PTINS) of former UTS employees without their knowledge or consent to file the fraudulent returns with the IRS. PTINS are issued by the IRS and are usually placed in the paid preparer section of a tax return that is prepared for compensation.

        The IRS processed the fraudulent returns and, at Umoren’s direction, transferred the refunds to Refund Advantage, a third-party entity that established temporary bank accounts for tax preparers to receive a client’s refund, and Umoren then caused Refund Advantage to transfer the portion of additional money he collected from his clients’ refunds to a bank account under his control. Umoren fraudulently obtained at least $134,405.14 from his scheme.

        In addition, Umoren also falsely represented himself to be an agent of the U.S. Government and detained a victim and others, and attempted to arrest and search the residence of a victim.

        If convicted, Umoren could face a maximum sentence of five years’ imprisonment for the false return charges, 20 years’ imprisonment for each of the wire fraud counts, three years’ imprisonment for the impersonation charge, and a mandatory statutory sentence of two years’ imprisonment for the aggravated identity theft counts.

        • [1] The facts in this case narrative come from the following publicly available documents: D. Nev. Superseding Indict. filed Sept. 11, 2019.


        • October 23, 2019

          Coconspirators Indicted in Connection with an International Impersonation Scheme Targeting U.S. Victims [1]

          On August 22, 2019, in the Eastern District of New York, Kamal Zafar, Jamal Zafar, and Armughanul Asar were indicted on charges of conspiracy to commit wire fraud and conspiracy to commit money laundering, in connection with an impersonation and internet retail scheme directed at thousands of individuals across the United States.

          According to the indictment, as part of the scheme telemarketing call centers in India placed calls to U.S. victims seeking to defraud them of money by various fraudulent scenarios. Among the fraudulent scenarios was a scam wherein callers contacted the victims and falsely claimed to be agents of U.S. Government agencies, including the Internal Revenue Service. The callers falsely claimed they were contacting the victims to inform them that they owed the U.S. Government a specified amount of money and, if the victims did not immediately remit payment to the individuals or entities identified by the callers, they would be arrested.

          Between January 2018 and September 2018, Kamal Zafar, Jamal Zafar, Asar, and others opened bank accounts in the names of various inactive and shell corporations for the purpose of receiving fraud proceeds. Shortly after receiving the wire transfer payments that the victims sent, the defendants and others withdrew and directed shell company owners to withdraw the fraudulently obtained victims’ funds and then distributed the money via cashier’s checks and wire transfers to other bank accounts. The defendants, together with others, received approximately $2.3 million from the victims as a result of the fraud scheme.

          If convicted, the defendants face criminal forfeiture and a maximum penalty of 20 years’ imprisonment.

          • [1] The facts in this case narrative come from the following publicly available documents: E.D.N.Y. Indict. filed Aug. 22, 2019; and E.D.N.Y. DOJ Press Release dated Aug. 26, 2019.


          • Man Pleads Guilty to Charges Related to Attempting to Obtain President’s Tax Returns [1]

            On August 6, 2019, in the Eastern District of Pennsylvania, Justin Hiemstra pled guilty to charges arising from his using someone else’s username to access a school computer and attempting to obtain the tax returns of Donald Trump, without permission, from the Internal Revenue Service (IRS). Hiemstra and codefendant Andrew Harris were charged with the offenses on July 17, 2019.

            According to court documents, Hiemstra and Harris, two students at Haverford College, went to the school’s computer lab and attempted to obtain President Trump’s tax returns via the Free Application for Student Aid (FAFSA) website. Hiemstra and Harris opened a false FAFSA application in the name of a member of the Trump family and found that someone else had already obtained a Federal Student Aid Identification (FSA-ID) for President Trump and identification password. In general, before beginning one’s very first FAFSA application, an individual registers with the Office of Federal Student Aid. Once registered, the individual obtains a unique identifier, known as an FSA-ID, essentially the equivalent of a username. Once the individual has activated the FSA-ID, the individual can complete the first FAFSA application, and any subsequent applications, through the FAFSA website.

            In order to reset the identification password, Hiemstra and Harris were required to answer challenge questions which that other individual had originally created when first setting up the FSA-ID and password. They were able to do so and reset the password. Using President Trump’s personal identifiers, including his Social Security Number and date of birth, Hiemstra and Harris unsuccessfully attempted to import President Trump’s Federal tax information into the false FAFSA application they had initiated in the name of a Trump family member.

            When questioned by law enforcement, Hiemstra stated that credentials from two other Haverford College students were used to access the two computers that he and Harris used. Hiemstra could face a maximum statutory penalty of one-year imprisonment and a $100,000 fine for each count. Sentencing is scheduled for December 16, 2019.

            • [1] The facts in this case narrative come from the following publicly available documents: E.D. Pa. Information filed July 17, 2019; E.D. Pa. Gov. Plea Memorandum filed Aug. 5, 2019; and E.D. Pa. Crim. Dockets as of Aug. 8, 2019.


            • IRS Employee Pleads Guilty to Soliciting and Receiving Bribe [1]

              On July 24, 2019, in the Central District of California, Internal Revenue Service (IRS) employee Felecia Taylor pled guilty to soliciting and receiving a bribe in her capacity as a public official. Special agents of the Treasury Inspector General for Tax Administration previously arrested Taylor in May 2019, when she was charged with the offense.

              According to the court documents, Taylor corruptly sought and received something of value in return for being influenced in the performance of an official act. Taylor has been employed by the IRS since February 1990 and is currently employed as a tax specialist. Taylor’s duties include planning and conducting examinations of individual and business taxpayers.

              On May 1, 2019, a taxpayer reported that he met with Taylor at her Long Beach office regarding an IRS audit of his 2017 Federal income tax return. Taylor corruptly sought a $5,000 cash bribe while in the performance of her official duties, in exchange for lowering the taxpayer’s tax liability. She also scheduled a follow-up meeting.

              On May 7, 2019, the taxpayer met with Taylor at her Long Beach office, which was monitored by law enforcement. Taylor provided adjusted tax records that showed a reduction of the taxpayer’s tax liability to approximately $10,616, the number agreed to at their prior meeting. In exchange, the taxpayer provided Taylor with the $5,000 cash bribe payment, which she accepted.

              Taylor could face a maximum statutory penalty of 15 years’ imprisonment and a fine of $250,000. Sentencing in this matter has not yet been scheduled.

              • [1] The facts in this case narrative come from the following publicly available documents: C.D. Cal. Crim. Compl. filed May 8, 2019; C.D. Cal. Executed Arrest Warrant filed May 9, 2019; C.D. Cal. Plea Agr. filed July 24, 2019; and C.D. Cal. Crim. Docket as of July 29, 2019.


              • Former IRS Employee Sentenced for Making False Statements [1]

                On July 15, 2019, in the Eastern District of Kentucky, former Internal Revenue Service (IRS) employee Jason Helton was sentenced for making false statements.

                According to the court documents, Helton was employed as an IRS revenue officer between July 2014 and April 2016. During this period, he submitted to the IRS travel vouchers, case histories, and time reports on which he falsely reported travel expenses that he did not actually incur and work that he did not actually perform. The submission of these documents and the false statements contained therein caused the United States to make payments to him to which he was not entitled. Helton knew that these documents contained false statements and intended that the false statements would result in his obtaining money from the United States to which he was not entitled.

                Helton was sentenced to time served followed by three years of supervised release. He was further ordered to pay $10,000 in restitution to the IRS.

                • [1] The facts in this case narrative come from the following publicly available documents: E.D. Ky. Indict. filed Feb. 23, 2017; U.S.C.A. Sixth Circuit Order filed Feb. 1, 2019; E.D. Ky. Plea Agr. filed Apr. 8, 2019; E.D. Ky. Judgment filed July 16, 2019; and E.D. Ky. Crim. Docket as of Aug. 1, 2019.


                • Nigerian Citizen Sentenced for Scheme to Defraud the United States [1]

                  On June 28, 2019, in the Western District of Michigan, Nigerian citizen Charles Aghogho Ejinyere was sentenced for conspiracy to defraud the United States. Ejinyere was initially indicted for the offense in February 2017 and was later arrested in the United Kingdom, where he was residing. Ejinyere was extradited to the Western District of Michigan, where he pled guilty to the charge in February 2019.

                  According to the court documents, from at least December 2014 to about February 2016, Ejinyere conspired with others, including codefendant Oghenevwakpo Igboba, to defraud the Internal Revenue Service (IRS) by knowingly participating in a scheme to obtain Federal income tax refunds by means of fraudulent representations.

                  As part of the scheme, codefendant Igboba obtained the personally identifiable information (PII) of other individuals and accessed online IRS systems, including eAuthentication and Get Transcript, to obtain additional tax-related information for those individuals. Ejinyere, Igboba, and their coconspirators then filed or caused to be filed, without authorization, fraudulent tax returns with the IRS in the names of the individuals whose PII they had obtained. Ejinyere and Igboba directed refunds from the fraudulent returns to be deposited into bank and credit union accounts belonging to Igboba, his businesses, his family members, associates, and unwitting accomplices. As part of their scheme, Ejinyere and Igboba collectively sought more than $930,000 in fraudulent tax refund claims, and the U.S. Treasury Department paid at least $426,000 in tax refunds based on those false claims.

                  Codefendant Igboba had previously been sentenced in January 2019 to 162 months’ imprisonment followed by three years of supervised release. He was further was ordered to pay $514,823 in restitution to the IRS and to forfeit $48,205.

                  Ejinyere was sentenced to 30 months’ imprisonment and ordered to pay $21,856 in restitution to the IRS.

                  • [1] The facts in this case narrative come from the following publicly available documents: W.D. Mich. Indict. filed Feb. 7, 2017; W.D. Mich. Affidavit in Support of Request for Extradition filed Mar. 3, 2017; W.D. Mich. Judgment filed Jan. 31, 2019; W.D. Mich. Plea Agreement filed Feb. 25, 2019; W.D. Mich. Judgment filed July 1, 2019; and W.D. Mich. Crim. Docket as of July 24, 2019.


                  • October 2, 2019

                    Florida Tax Preparer Pleads Guilty in Scheme Involving Wire Fraud [1]

                    On August 16, 2019, in the Southern District of Florida, Fort Lauderdale tax preparer Deborah Thomas pled guilty to three counts of wire fraud in connection with a scheme to misappropriate her clients’ monies, which had been intended to satisfy taxes owed to the Internal Revenue Service (IRS). Thomas was previously indicted for the offenses in May 2019.

                    According to the indictment, from April 2015 through May 2018, Thomas worked as a tax preparer at a public accounting firm. In an effort to unjustly enrich herself, she registered Global Business Concepts, LLC (operating as U.S. Treasures). She subsequently opened a bank account in the name of that business, where she then deposited fraudulently-obtained checks.

                    Thomas instructed some of her clients who owed money to the IRS to write checks payable to “U.S. Treasury.” She then had the checks stamped or altered, making it difficult to see the last letters of the payee. Thomas instructed other clients, whose primary language was not English, to make checks payable to “U.S. Treasures” or “U.S. Treasure.” Thomas did not give those client checks to the IRS, but instead deposited them into her U.S. Treasures account through automated teller machines in Fort Lauderdale, Florida. Images of the deposited checks were then transmitted via wire communication to servers located in Richardson, Texas, allowing them to be credited to Thomas’ own business bank account. The fraudulent proceeds obtained by Thomas totaled more than $654,779.

                    Thomas could face a maximum statutory sentence of 20 years’ imprisonment and a $250,000 fine. Sentencing is scheduled for October 25, 2019.

                    • [1] The facts in this case narrative come from the following publicly available documents: S.D. Fla. Indict. filed May 16, 2019; S.D. Fla. Plea Agr. filed Aug. 19, 2019; and S.D. Fla. Crim. Docket as of Aug. 21, 2019.


                    • Two Individuals Indicted in Connection with Impersonation Scheme [1]

                      On August 13, 2019, in the Eastern District of Wisconsin, Hardik Patel and Mahmadyasin Shekh were indicted on charges of mail fraud, when they, and others known and unknown to the grand jury, knowingly participated in a scheme with the intent to defraud and obtain money by means of materially false representations.

                      According to the indictment, other members of the scheme called victims and misrepresented that they worked for various Federal agencies, including the Internal Revenue Service, the Federal Bureau of Investigation, and the Social Security Administration. The caller told the victim that if he or she did not send money as directed by the caller, he or she would be immediately arrested. The caller then instructed the victim to send cash to a specific location and to a specific, fictitious name. The cash was sent via Federal Express packages from various locations nationwide to various locations within in the Eastern District of Wisconsin. Patel, Shekh, and other participants in the scheme possessed fraudulent identification documents bearing the fictitious names of the recipients of the cash and a photo of themselves, which they used to pick up the packages. They then kept a percentage of the fraud proceeds and sent the rest to other members of the scheme. As a result of the scheme, Patel, Shekh, and other participants in the scheme fraudulently obtained at least $219,983 from approximately 12 victims.

                      If convicted, Patel and Shekh will be ordered to forfeit to the United States any property which constitutes, or is derived from, proceeds traceable to the offense or offenses of conviction. Patel and Shekh could face a maximum statutory sentence of 20 years’ imprisonment.

                      • [1] The facts in this case narrative come from the following publicly available document: E.D. Wis. Indict. filed Aug. 13, 2019.


                      • Coconspirators Indicted in Connection with Scheme Involving Stolen Federal Tax Refund Checks [1]

                        On August 26, 2019, in the Southern District of New York, Marlene Tineo, Alejandro Paulino, and Raysette Mercedes were indicted for conspiracy, bank fraud, and aggravated identity theft in connection with a scheme involving the theft of U.S. Treasury checks, to include tax refund checks.

                        According to court documents, between December 2017 and February 2019, Tineo, Paulino, Mercedes, and others known and unknown, willfully and knowingly conspired to execute a scheme to defraud financial institutions, the deposits of which were insured by the Federal Deposit Insurance Corporation.

                        The scheme to defraud was identified when a financial institution identified a pattern of suspicious activity in multiple accounts. Specifically, U.S. Treasury checks, including tax refund and Social Security checks were stolen before reaching their intended recipient. The defendants then opened fraudulent accounts at the bank in the names of the intended recipients of the stolen checks. The fraudulent accounts were opened with apparently fraudulent Dominican Republic identification documents, such as passports, consular cards, and drivers’ licenses, and using forged signatures. The defendants forged the signatures to endorse the stolen checks and deposited these checks into the fraudulent accounts. They then made cash withdrawals to access the stolen funds. Tineo, Paulino, and Mercedes are believed to have accessed bank accounts that held a total of approximately $822,000 in U.S. Treasury checks.

                        If convicted, Tineo, Paulino, and Mercedes shall be ordered to forfeit to the United States any and all property derived from proceeds obtained as a result of the commission of said offenses. The defendants could each face a maximum statutory sentence of 30 years’ imprisonment for bank fraud, plus a mandatory consecutive sentence of two years’ imprisonment for aggravated identity theft.

                        • [1] The facts in this case narrative come from the following publicly available documents: S.D.N.Y. Crim. Compl. filed Jul. 30, 2019; and S.D.N.Y. Indict. filed Aug. 26, 2019.


                        • IRS Employee Pleads Guilty to the Unauthorized Disclosure of Suspicious Activity Reports [1]

                          On August 14, 2019, in the Northern District of California, Internal Revenue Service (IRS) employee John C. Fry pled guilty to the unauthorized disclosure of Suspicious Activity Reports (SARs). Fry was previously indicted for the offense in February 2019.

                          According to court documents, Fry is an investigative analyst for IRS Criminal Investigation (IRS-CI) in San Francisco, California, and has worked for the IRS since 2008. In this position, he had access to various law enforcement databases, including the Financial Crimes Enforcement Network (FinCEN) and Palantir, which is an analytic software used by IRS-CI. FinCEN manages the collection and maintenance of SARs, which financial institutions are required to generate under the Bank Secrecy Act to report potentially suspicious financial transactions. The disclosure of a SAR or its contents is unlawful, and employees or agents of Government authorities are prohibited from disclosing a SAR, or any information that would reveal even the existence of a SAR, except as necessary to fulfill official duties.

                          Fry admitted that on May 4, 2018, he logged on to the Palantir database from his work computer and downloaded five SARs related to Michael Cohen and his company, Essential Consultants. Fry then called Michael Avenatti, an attorney based in Newport Beach, California, twice from his personal cell phone. During those conversations, Fry verbally provided information contained in the five SARs to Avenatti. Fry also used one of his personal e-mail accounts to e-mail screenshots of the SARs to Avenatti. Fry admitted that on May 7, 2018, he logged on to the FinCEN database from his work computer and conducted additional searches related to Cohen and Essential Consultants. He then called Avenatti from his personal cell phone and verbally provided information contained in the searches. Fry admitted that he had no official reason in his capacity as an IRS investigative analyst to disclose SAR records related to Cohen or the various companies listed in the SARs.

                          On May 8, 2018, Avenatti circulated a dossier on his public Twitter account releasing the confidential banking information related to Cohen and Essential Consultants. On May 8, 2018, The Washington Post published an article that discussed in detail claims about Cohen’s banking history made public in Avenatti’s dossier. On May 12, 2018, Fry placed an outgoing call to a number later identified as being associated with a reporter. On May 16, 2018, The New Yorker published an article written by this reporter titled “Missing Files Motivated the Leak of Michael Cohen’s Financial Records.” The article reported that the source, identified only as a law enforcement officer, grew alarmed after being unable to find two important SARs regarding Cohen’s financial activity. In fact, access to the two SARs in question had been restricted and they were not available to all FinCEN users.

                          Fry could face a maximum of five years’ imprisonment and a $250,000 fine. Sentencing in this matter is scheduled for December 18, 2019.

                          • [1] The facts in this case narrative come from the following publicly available documents: N.D. Cal. Crim. Compl. filed Feb. 4, 2019; N.D. Cal. Indict. filed Feb. 28, 2019; and N.D. Cal. Plea Agr. filed Aug. 14, 2019.


                          • August 26, 2019

                            Man Arrested for Targeting Elderly in Jamaican Lottery Scheme [1]

                            On June 27, 2019, Sheldon Hibbert was arrested in Orlando, Florida. Hibbert had previously been charged by criminal complaint in the District of Arizona with a money laundering conspiracy of proceeds of a mail and wire fraud scheme on June 20, 2019.

                            According to the criminal complaint, financial exploitation is a fast-growing form of abuse of elderly and other vulnerable individuals. Hibbert was allegedly involved in a scheme to obtain money from victims who were informed that they had won substantial cash prizes in a sweepstakes lottery. The victims were told that before they could claim their prizes they had to pay taxes and fees. Two victims interviewed reported estimated losses totaling more than $1,070,000 in connection with this scheme in 2015 and 2017. One of the victims reported making payments directly to Hibbert via cashier’s check and wire transfers. Between February 2015 and October 2015, Hibbert made 18 money transfers totaling $34,158 to individuals in Jamaica, indicating that Hibbert was acting as a money runner in this scheme.

                            The court ordered that Hibbert be transported to the District of Arizona, where he is to remain in custody pending trial.

                            • [1] The facts in this case narrative come from the following publicly available documents: D. Ariz. Crim. Compl. filed June 20, 2019; M.D. Fla. Executed Arrest Warrant filed June 27, 2019; M.D. Fla. Commitment to Another District filed July 1, 2019; and D. Ariz. Order of Detention filed July 1, 2019.


                            • Jury Finds Man Guilty on All Eight Counts of Indictment in Scheme to Defraud the Internal Revenue Service [1]

                              On June 28, 2019, in the Western District of New York, a jury found Emmanuel Guobadia guilty on four counts of wire fraud and four counts of aggravated identity theft in connection with a scheme he devised to defraud the Internal Revenue Service (IRS). Guobadia had previously been indicted for the offenses in April 2016.

                              According to court documents, between about May 2012 and July 2012, Guobadia electronically filed fraudulent Federal income tax returns using the names and Social Security Numbers of others and claimed tax refunds to which he was not entitled. As part of the scheme, 628 fraudulent tax returns claiming a total of $1,252,524 in fraudulent tax refunds were filed with the IRS for Tax Year 2011. Of those attempted refund claims, the IRS electronically deposited $178,658 in tax refunds into bank accounts owned by a third-party individual known to the court, as directed on the returns.

                              On four occasions, Guobadia also directed the third-party individual, who was located in New York, to wire transfer fraudulently obtained funds into his bank account located in the State of Georgia.

                              In October 2013, Guobadia was arrested, and several laptop computers were seized. Search warrants obtained for the contents of the computers resulted in the identification of approximately 2,000 unique names with associated personal identification information, bank account information, and electronic return originator (ERO) passwords. When a tax return is filed online through an ERO, the return preparer must provide a unique password for that return.

                              Guobadia faces a maximum statutory penalty of 20 years’ imprisonment and a $250,000 fine for the charge of wire fraud. He faces a maximum statutory penalty of two years’ imprisonment for the charges of aggravated identity theft, to run consecutively with the sentence imposed for the wire fraud violations. Sentencing is scheduled for October 2, 2019.

                              • [1] The facts in this case narrative come from the following publicly available documents: W.D.N.Y. Crim. Compl. filed Nov. 20, 2015; W.D.N.Y. Indict. filed Apr. 28, 2016; W.D.N.Y. DOJ Press Release dated May 2, 2016; W.D.N.Y. Verdict Sheet filed July 1, 2019; and W.D.N.Y. Crim. Docket as of July 11, 2019.


                              • Tax Preparer Sentenced for Wire Fraud and Subscription to False Returns [1]

                                On June 12, 2019, in the Central District of California, tax preparer Aaron Joshua was sentenced for wire fraud and subscription to a false tax return. Joshua was previously charged with, and pled guilty to, the offenses in September 2018.

                                According to the plea agreement, Joshua was the owner and operator of a tax preparation business that operated under the names Joshua Management Group and The Joshua Group, LLC (collectively referred to as JMG), and that he used to prepare Federal and State income tax returns for clients.

                                From about 2010 until at least February 2017, Joshua devised and executed a scheme to defraud his clients by obtaining monies for himself that were due to JMG’s clients. Without the knowledge or authorization of his clients, Joshua instructed the Internal Revenue Service (IRS) to deposit portions of his clients’ refunds into his bank accounts. In some cases, these deposits exceeded the amounts agreed upon for his tax preparation fees.

                                For example, Joshua prepared individual tax returns for one victim for five separate tax years and charged the client approximately $300 for each return. For each year, Joshua provided the client with an electronic copy of a tax return claiming a significantly smaller tax refund than what was claimed on the return that Joshua filed with the IRS. In addition, Joshua attached an IRS Form 8888, Allocation of Refund, containing the taxpayer’s name and Social Security Number, to each of the filed returns. However, Joshua’s client did not authorize him to attach these allocation forms, which stated significantly higher refund amounts than were claimed on the client’s copies of the returns. Joshua directed that the overages, i.e., the differences between the refund amounts claimed in the filed returns and the refund amounts stated on the client copies, to be paid into his bank accounts.

                                Between 2011 and 2016, portions of 212 Federal tax refunds totaling approximately $444,648 were deposited into Joshua’s bank accounts and other bank accounts used in the scheme.

                                Additionally, Joshua submitted a false individual tax return for his own account in 2015, claiming income of only $10,346, when, in fact, he knew that he had additional income of approximately $133,923 for the tax year.

                                Joshua was sentenced to 20 months’ imprisonment followed by three years of supervised release. He was further ordered to pay $444,648 in restitution.

                                • [1] The facts in this case narrative come from the following publicly available documents: C.D. Cal. Info. filed Sep. 28, 2018; C.D. Cal. Plea Agr. filed Sep. 28, 2018; and C.D. Cal. Judgment filed June 14, 2019.


                                • Coconspirators Sentenced in Connection With Scheme Involving Stolen Federal Tax Refund Checks [1]

                                  On June 19, 2019, in the Western District of Missouri, Joseph Hooks and Mistie Smith were sentenced for bank fraud and aggravated identity theft in connection with a scheme involving the theft of U.S. Treasury tax refund checks. Hooks and Smith had previously been indicted for the offenses in May 2018, and they pled guilty in January 2019.

                                  According to court documents, Smith contacted or recruited coconspirators, including Hooks, to participate in a scheme to negotiate U.S. Treasury checks that had been stolen from the U.S. Postal Service mail stream. These checks had been issued for tax refunds and were printed and mailed in Kansas City, Missouri. The coconspirators then obtained fraudulent identification documents, such as driver’s licenses, in order to deposit the stolen refund checks.

                                  Between March 2016 and May 2016, the coconspirators negotiated the stolen refund checks at various branches of Academy Bank, a financial institution headquartered in Kansas City, Missouri. They used the false identification documents in order to open bank accounts in the names depicted on the checks. They then deposited the checks into the newly created accounts and subsequently withdrew the majority of the money. Hooks cashed eight U.S. Treasury tax refund checks in this manner, totaling $31,910.00. The scheme resulted in the fraudulent negotiation of approximately 99 checks, with a total financial loss of approximately $447,517.00.

                                  Smith was sentenced to 36 months’ imprisonment followed by three years of supervised release. She was further ordered to pay $441,056.27 in restitution.

                                  Hooks was sentenced to 36 months’ imprisonment followed by three years of supervised release. He was further ordered to pay $31,910.00 in restitution.

                                  • [1] The facts in this case narrative come from the following publicly available documents: W.D. Mo. Indict. filed May 2, 2018; W.D. Mo. Judgments filed June 19 & 20, 2019; and W.D. Mo. Plea Agr. filed Jan. 25, 2019.


                                  • Individual Sentenced in Treasury Check Theft Ring [1]

                                    On May 30, 2019, in the Southern District of New York, Gelson Rojas was sentenced for the theft of U.S. Treasury checks. Rojas was previously indicted in June 2018, along with six other defendants, on charges of conspiracy to steal Government funds, theft of Government funds, and aggravated identity theft. Rojas and four of the defendants were also charged with conspiracy to commit bank fraud and bank fraud.

                                    According to court documents, from about May 2012 up to September 2017, Rojas and the others knowingly and willfully conspired to steal Government funds from the Internal Revenue Service (IRS) and convert them for their own use. The defendants wrongfully obtained U.S. Treasury checks in the names of victims and sold, deposited, or cashed the checks without the victims’ authorization.

                                    Rojas and the other defendants knowingly and without lawful authority used, aided, and abetted in the use of names, signatures, addresses, dates of birth, Social Security Numbers, and driver’s license numbers of other individuals in connection with the offenses.

                                    In furtherance of the scheme, Rojas and four other defendants cashed and deposited stolen checks into bank accounts, including accounts opened by using stolen identities. The investigation identified deposits of approximately $3.5 million in stolen tax refund checks.

                                    Rojas was sentenced to 24 months’ imprisonment and ordered to pay $494,003.64 in restitution.

                                    • [1] The facts in this case narrative come from the following publicly available documents: S.D.N.Y Crim. Compl. filed May 16, 2018; S.D.N.Y. Indict. filed June 18, 2018; and S.D.N.Y. Judgment filed June 13, 2019.


                                    • July 29, 2019

                                      Florida Tax Preparer Indicted in Scheme Involving Wire Fraud [1]

                                      On May 16, 2019, in the Southern District of Florida, Fort Lauderdale tax preparer Deborah Thomas was charged with nineteen counts of wire fraud in connection with a scheme to misappropriate her clients’ monies, which had been intended to satisfy taxes owed to the Internal Revenue Service (IRS). Thomas was arrested on May 24, 2019.

                                      According to the indictment, from April 2015 through May 2018, Thomas worked as a tax preparer at a public accounting firm. In an effort to unjustly enrich herself, she registered Global Business Concepts, LLC (operating as U.S. Treasures). She subsequently opened a bank account in the name of that business, where she then deposited fraudulently obtained checks.

                                      Thomas instructed some of her clients who owed money to the IRS to write checks payable to “U.S. Treasury.” She then had the checks stamped or altered, making it difficult to see the last letters of the payee. Thomas instructed other clients, whose primary language was not English, to make checks payable to “U.S. Treasures” or “U.S. Treasure.” Thomas did not give those client checks to the IRS, but instead deposited them into her U.S. Treasures account through automated teller machines in Fort Lauderdale, Florida. Images of the deposited checks were then transmitted via wire communication to servers located in Richardson, Texas, allowing them to be credited to Thomas’ own business bank account. The fraudulent proceeds obtained by Thomas totaled more than $654,779.

                                      If convicted, Thomas could face a maximum statutory sentence of 20 years’ imprisonment and a $250,000 fine.

                                      • [1] The facts in this case narrative come from the following publicly available documents: S.D. Fla. Indict. filed May 16, 2019; and S.D. Fla. Crim. Docket as of Jun. 10, 2019.


                                      • Six Individuals Sentenced for Their Roles in Sophisticated Impersonation Fraud [1]

                                        Between March 25, 2019 and May 29, 2019, in the Middle District of Florida, six defendants were sentenced for their roles in a conspiracy involving a sophisticated Internal Revenue Service (IRS) impersonation and loan scam. The defendants had previously been charged with their respective offenses in 2018.

                                        According to court documents, beginning August 2014 and continuing until June 2016, the defendants, in connection with India-based call centers, participated in a scam in which callers impersonated IRS employees or loan officers to extort money from U.S. residents. The callers induced fear in their victims by threatening them with prosecution and/or arrest for purported Federal tax violations or unpaid loans, unless the victims paid alleged taxes, fines, and/or fees immediately. Some of the victims were instructed to purchase prepaid stored-value cards and then provide the unique serial numbers of those cards to the caller or payment processor, an individual who instructs victims to make payments and facilitates the movement of victims’ funds throughout the United States. Other victims were directed to transmit money using money services businesses or to deposit money into various bank accounts. If a victim was defrauded through prepaid stored-value cards, the conspirators would obtain general purpose reloadable (GPR) debit cards and transmit the unique identification numbers on those cards via interstate and foreign wire communications to other conspirators. Those individuals activated the GPR cards by registering them online or by telephone, using the personally identifiable information of U.S. residents without their consent. Conspirators would then either withdraw fraudulent proceeds from the GPR cards, retrieve fraudulent proceeds from the money-transmitter services, or withdraw fraudulent proceeds from bank accounts.

                                        Defendants Hemalkumar Shah and Nishitkumar Patel served dual roles in this scheme. As domestic managers, they recruited, hired, and directed runners to pick up funds wired by victims, directed runners to open bank accounts to receive fraudulent proceeds, provided runners with transportation, collected fraudulent proceeds from runners, and disbursed fraudulent proceeds in accordance with directives received from conspirators in India. As runners, they would purchase GPR cards and forward the card numbers to conspirators, purchase money orders and obtain cash using GPR cards funded with fraudulent proceeds, retrieve cash payments made by victims via money-transmitter services, and retrieve victims’ funds that had been deposited into bank accounts. Shah and Niskitkumar Patel had previously pled guilty to conspiracy to commit wire fraud and aggravated identity theft. Sharvil Patel’s role in this scheme was that of a domestic manager, and he had previously pled guilty to conspiracy to commit wire fraud.

                                        The roles of defendants Alejandro Juarez and Brenda Dozier were to pick up fraudulently-obtained funds from money-transmitter services that had been wired by the victims and then either to provide cash to other U.S.-based conspirators and/or to deposit the funds into U.S. bank accounts as directed. Both had previously pled guilty to conspiracy to commit money laundering.

                                        According to court documents, defendant Anthony Trujillo knowingly received stolen monies valued at $5,000 or more by transporting said monies from California to Florida. Trujillo had previously pled guilty to possession and receipt of stolen, unlawfully converted, or taken property.

                                        The cumulative total of the prison sentences for defendants Sharvil Patel, Shah, Nishitkumar Patel, Juarez, and Dozier is 333 months. Further, each term is to be followed by 36 months of supervised release. Trujillo was sentenced to 60 months’ probation. The defendants will be required to pay more than $3.1 million in restitution.

                                        • [1] The facts in this case narrative come from the following publicly available documents: M.D. Fla. Indict. filed Oct. 11, 2018; M.D. Fla. Infos. filed Oct 26, 2018; M.D. Fla. Superseding Info. filed Dec. 12, 2018; M.D. Fla. Plea Agreements filed Dec. 14, 2018, Dec. 17, 2018, Dec. 18, 2018, Dec. 27, 2018, Jan. 14, 2019, and Jan. 29, 2019; and M.D. Fla. Judgments filed Mar. 26, 2019, Apr. 1, 2019, Apr. 8, 2019, Apr. 18, 2019, May 1, 2019, and May 30, 2019.


                                        • Georgia Man Sentenced for Offering IRS Employee $30,000 to Falsify Audit Results [1]

                                          On May 14, 2019, in the Northern District of Georgia, Magdaleno Garcia Alonso was sentenced for bribery of a public official. Alonso had previously been indicted for the offense in November 2018 and had pled guilty in February 2019.

                                          According to court documents, on or about September 19, 2018, Alonso offered an Internal Revenue Service (IRS) revenue agent $30,000 with the intent of inducing the revenue agent to commit an act that was in violation of his or her lawful duties. Specifically, Alonso offered the revenue agent $30,000 to falsify the audit results of Alonso’s personal Federal income tax returns and the returns of Acworth Georgia Concrete, Incorporated, for Tax Years 2015 and 2016.

                                          Alonso was sentenced to 24 months’ imprisonment followed by one year of supervised release.

                                          • [1] The facts in this case narrative come from the following publicly available documents: N.D. Ga. Indict. filed Nov. 6, 2018; N.D. Ga. Plea Agr. filed Feb. 7, 2019; and N.D. Ga. Judgment filed May 14, 2019.


                                          • Miami Tax Services Provider Sentenced for Forcibly Assaulting and Threatening IRS Employee With Shotgun [1]

                                            On April 22, 2019, in the Southern District of Florida, tax services provider Jimmy Sierra was sentenced for forcibly assaulting an Internal Revenue Service (IRS) revenue officer who was engaged in the performance of his official duties. Sierra was indicted for the offense in June 2018, and he pled guilty in February 2019.

                                            According to court documents, on or about May 21, 2018, the revenue officer conducted a field visit to collect a tax payment from a tax business in Miami, Florida, of which Sierra is a registered agent. Upon arrival, the revenue officer identified himself to Sierra as an IRS employee and presented his IRS credentials. Sierra subsequently invited the revenue officer inside. Once they were inside Sierra’s office, Sierra pushed a button on his phone and another male showed up in his office. Sierra opened a drawer in his desk and pulled out what appeared to be a shotgun, pointed it at the unarmed revenue officer, and stated in part, “You want money…? I’m going to shoot you. You want it in the balls or you want it in the chest?” The revenue officer believed that Sierra had a fully functioning firearm and intended to shoot him. At that time, the revenue officer backed away, again displayed his IRS-issued credentials, and called 911.

                                            Sierra again stated aloud to the other male that he was going to shoot the revenue officer. The revenue officer, believing that he was in a fight for his life, grabbed the shotgun stock and wrestled with Sierra over the weapon. During the exchange, Sierra struck the revenue officer, who sustained injuries. The revenue agent was able to flee Sierra’s office and was later transported to a hospital for medical attention.

                                            Sierra was sentenced to time served followed by two years of supervised release. He was further ordered to pay $1,550 in restitution.

                                            • [1] The facts in this case narrative come from the following publicly available documents: S.D. Fla. Crim. Compl. filed May 23, 2018; S.D. Fla. Indict. filed June 5, 2018; S.D. Fla. Plea Agr. filed Feb. 13, 2019; S.D. Fla. Factual Proffer filed Feb. 13, 2019; and S.D. Fla. Judgment filed Apr. 25, 2019.

                                              June 24, 2019

                                              IRS Employee Charged with Soliciting and Accepting Bribe [1]

                                              On May 8, 2019, in Los Angeles County, within the Central District of California, Internal Revenue Service (IRS) employee Felecia Taylor was charged with soliciting and accepting a bribe in her capacity as a public official.

                                              According to court documents, Taylor corruptly sought and received something of value in return for being influenced in the performance of an official act. Taylor has been employed by the IRS since February 1990 and is currently employed as a tax specialist. Taylor’s duties include planning and conducting examinations of individual and business taxpayers.

                                              On May 1, 2019, a taxpayer reported that he met with Taylor at her Long Beach office regarding an IRS audit of his 2017 Federal income tax return. Taylor corruptly sought a $5,000 cash bribe while in the performance of her official duties, in exchange for lowering the taxpayer’s tax liability. She also scheduled a follow-up meeting.

                                              On May 7, 2019, the taxpayer had a meeting with Taylor at her Long Beach office, which was monitored by law enforcement. Taylor provided adjusted tax records that showed a reduction of the taxpayer’s tax liability to approximately $10,616, the number agreed to at their prior meeting. In exchange, the taxpayer provided Taylor with the $5,000 cash bribe payment, which she accepted.

                                              Special Agents of the Treasury Inspector General for Tax Administration subsequently arrested Taylor on May 9, 2018. Her initial appearance was held the same day, and she was released on bond. Additional legal actions are pending.

                                              • [1] The facts in this case narrative come from the following publicly available documents: C.D. Cal. Crim. Compl. filed May 8, 2019; C.D. Cal. Executed Arrest Warrant filed May 9, 2019; and C.D. Cal. Crim. Docket as of May 14, 2019.


                                              • Individual Sentenced in Connection With Scheme Involving Stolen Federal Tax Refund Checks [1]

                                                On April 30, 2019, in the Western District of Missouri, Sharieff Sylvester was sentenced for bank fraud and aggravated identity theft in connection with a scheme involving the theft of U.S. Treasury tax refund checks. Sylvester and his codefendants were previously indicted for the offenses in May 2018, and he pled guilty in January 2019.

                                                According to the court documents, Sylvester was recruited by the coconspirators to participate in a scheme to negotiate U.S. Treasury checks that had been stolen from the U.S. Postal Service mail stream. The U.S. Treasury checks had been issued for tax refunds and were printed and mailed in Kansas City, Missouri. The coconspirators then obtained fraudulent identification documents, such as driver’s licenses, in order to deposit the stolen refund checks.

                                                Between March 2016 and May 2016, the coconspirators negotiated the stolen refund checks at various branches of Academy Bank, a financial institution headquartered in Kansas City, Missouri. They used the false identification documents in order to open bank accounts in the names depicted on the checks. They then deposited the checks into the newly created accounts and subsequently withdrew the majority of the money. Sylvester cashed six U.S. Treasury tax refund checks, totaling $20,416.00, in this manner, with each transaction being captured on bank security video. The scheme resulted in the fraudulent negotiation of approximately 99 checks, with a total financial loss of approximately $447,517.

                                                Sylvester was sentenced to 36 months’ imprisonment followed by three years of supervised release. He was further ordered to pay $20,416.00 in restitution.

                                                • [1] The facts in this case narrative come from the following publicly available documents: W.D. Mo. Indict. filed May 2, 2018; W.D. Mo. Plea Agr. filed Jan. 17, 2019; and W.D. Mo. Judgment filed Apr. 30, 2019.


                                                • Temporary IRS Employee Sentenced for Theft of Federal Tax Remittances [1]

                                                  On April 5, 2019, in the Western District of North Carolina, Internal Revenue Service (IRS) temporary employee Alicia Gambrell was sentenced to one count of theft of Government property. Gambrell was previously indicted on eight counts of the offense in March 2018, and pled guilty to one count in December 2018.

                                                  According to the court documents, from about March 2016 through about April 2017, Gambrell was an employee of a temporary employment agency at the IRS Lockbox Facility located in Charlotte, North Carolina.

                                                  The IRS, working with a Federally insured bank, operated a lockbox center in Charlotte. “Lockbox” is a process through which, among other things, Federal tax remittances, that is tax payments made payable to the IRS and/or the Treasury Department in the form of checks and money orders, were mailed by taxpayers to designated post office boxes for processing. Temporary employees hired through the temporary agencies and screened by the IRS work in the lockbox facility opening mail.

                                                  While working at the IRS Charlotte Lockbox Facility, Gambrell stole approximately 34 checks and money orders made payable to the IRS and totaling approximately $57,000. She then altered the payee information on the checks and money orders to reflect her own name. For example, she changed “IRS” to “MRS” then inserted “Gambrell.” Afterwards, she deposited the altered checks and money orders into accounts in her name or cashed the checks or money orders.

                                                  Gambrell was sentenced to 16 months’ imprisonment followed by two years of supervised release. She was further ordered to pay $29,302.16 in restitution to the IRS.

                                                  • [1] The facts in this case narrative come from the following publicly available documents: W.D.N.C. Indict. filed Mar. 21, 2018; W.D.N.C. Judgment filed May 1, 2019; and W.D.N.C. Crim. Docket as of May 2, 2019.


                                                  • IRS Employee Arrested in Connection With Identity Theft and Scheme to Defraud the IRS [1]

                                                    On April 23, 2019, in the Eastern District of California, special agents of the Treasury Inspector General for Tax Administration (TIGTA) arrested Internal Revenue Service (IRS) employee Deena Vang Lee for her role in a scheme to defraud the IRS and the United States. Lee was previously charged, on April 11, 2019, with multiple counts each of wire fraud, aggravated identity theft, making and subscribing a false and fraudulent tax return, and aiding and assisting in the preparation of a false and fraudulent return.

                                                    According to the 18-count indictment, at certain times relevant to the charges, Lee was employed at the IRS Fresno Service Center. From about February 2012 to about February 2016, Lee prepared and electronically filed fraudulent Federal income tax returns for friends, family members, and acquaintances. She charged many of her customers a tax preparation fee of between $100 and $400 for her services.

                                                    Lee allegedly included false information on forms that she prepared and submitted for her customers to claim the Child and Dependent Care Expenses tax credit. The IRS requires a form when a taxpayer claims a tax credit for expenses paid for the care of a qualifying individual. The form must include the care provider’s name, address, social security number, and amount paid to the provider. Lee fabricated the means of identification of multiple individuals and listed them (the “False Providers”) when preparing the forms. She also fabricated childcare expenses purportedly paid to the alleged providers, when in actuality, the False Providers did not provide childcare to the customers, nor did the customers pay the False Providers for childcare.

                                                    It is further alleged that Lee falsely inflated and/or fabricated expenses on forms she submitted for her customers to claim the American Opportunity tax credit. For those customers for whom Lee sought the credit, she typically falsely claimed the maximum adjusted qualified education expenses allowed per student. Lee also listed false dependents on her customers’ returns.

                                                    In certain cases, Lee’s actions resulted in the IRS’s either issuing excessive tax refunds via direct deposit into bank accounts controlled by the customers or Lee, or not collecting the correct amount of tax owed by the customers. Lee’s actions resulted in a tax loss to the IRS of more than $20,000.

                                                    In addition, Lee prepared and submitted, under penalties of perjury, fraudulent Federal income tax returns on her own behalf for Tax Years 2013 through 2015, which did not include income she received from customers for her tax preparation services.

                                                    If convicted, Lee could face a maximum statutory penalty of up to 20 years’ imprisonment and a $250,000 fine.

                                                    • [1] The facts in this case narrative come from the following publicly available documents: E.D. Cal. Indict. filed Apr. 11, 2019; E.D. Cal. Executed Arrest Warrant filed Apr. 23, 2019.


                                                    • May 21, 2019

                                                      Indian National Extradited to the United States to Face Charges for His Role in a Complex Impersonation Scam [1]

                                                      According to a Department of Justice (DOJ) press release, Hitesh Madhubhai Patel has been extradited to the United States to face charges of conspiracy to defraud the United States, conspiracy to commit wire fraud, and money laundering conspiracy, in connection with his leadership role in a multimillion-dollar India-based call center scam which targeted U.S. victims. A Treasury Inspector General for Tax Administration (TIGTA) special agent was part of the team that extradited Patel from Singapore to the Southern District of Texas, where his initial appearance was held on April 19, 2019. Patel was previously indicted for the offenses in October 2016, along with 55 other individuals and five call centers, in what was at that time the largest single domestic law enforcement action involving the Internal Revenue Service (IRS) impersonation scam.

                                                      TIGTA Inspector General J. Russell George stated, “TIGTA’s investigations, often conducted with other Federal agencies, have identified 140 scammers, including Patel, who have preyed upon taxpayers. Today’s extradition and arraignment are proof that TIGTA and its law enforcement partners will be equally relentless in rooting out individuals who fraudulently identify themselves as IRS employees in order to extort money from taxpayers. We especially appreciate the cooperation of the Government of Singapore for its role in the extradition.”

                                                      According to the court documents, Patel was identified as an operator of the India-based call center HGlobal. From about January 2012 and continuing until about October 2016, Patel and his coconspirators participated in a complex scheme to defraud U.S. residents by misleading them into sending money in connection with several different scams. In one of the scams, the coconspirators impersonated IRS officers to defraud U.S. residents by misleading them into believing that they owed money to the IRS and that they would be arrested and fined if they did not pay the alleged back taxes immediately. In another one of the scams, the coconspirators impersonated U.S. Citizenship and Immigration Services (USCIS) officers to defraud U.S. residents by misleading them into believing that they would be deported unless they immediately paid a fine for alleged problems with their USCIS paperwork

                                                      These complex fraud schemes resulted in hundreds of millions of dollars in losses by the victims. More than 15,000 known victims have incurred losses attributable to scam calls, and upwards of 50,000 individuals have had their identities misappropriated based on the unauthorized use of their Personally Identifiable Information to register general purpose reloadable cards

                                                      Previously, between July 18, 2018 and July 20, 2018, in the Southern District of Texas, 21 defendants were sentenced for their roles in connection with this complex scam, with three others having been sentenced earlier in 2018. The cumulative total of the prison sentences for the 21 defendants sentenced in July 2018 exceeded 174 years.

                                                      Pending a detention hearing, Patel has been temporarily remanded to custody of the court.

                                                      • [1] The facts in this case narrative come from the following publicly available documents: S.D. Tex. DOJ Press Release dated April 19, 2019; S.D. Tex. Superseding Indict. filed Oct. 19, 2016; S.D. Tex. Crim. Docket as of April 19, 2019; TIGTA Press Release dated Oct. 27, 2016; TIGTA Report for Aug. 20, 2018; and S.D. Tex. Order Scheduling Detention Hearing filed Apr. 19, 2019.


                                                      • California Man Sentenced for His Role in an Impersonation Scam [1]

                                                        On March 13, 2019, in the District of Minnesota, Yu Zhang was sentenced for conspiracy to commit wire fraud in connection with an interstate scheme to defraud by falsely impersonating IRS employees. Zhang was indicted for the offense in July 2018, and pled guilty in October 2018.

                                                        According to the court documents, from at least March 12, 2018 to June 8, 2018, Zhang conspired with others to participate in a scheme to defraud and to obtain money by material false and fraudulent pretenses. Zhang’s coconspirators contacted victims in numerous States throughout the country by telephone, falsely claimed to be IRS agents or other Government officials, and threatened the victims with arrest unless they made immediate payment for delinquent taxes.

                                                        The caller instructed the victims to purchase Target™ gift cards and to provide the caller with the gift card numbers and activation codes over the phone. Zhang, at the direction of his coconspirators, traveled to Target stores in multiple States, including Minnesota, Illinois, and Colorado, to redeem the Target gift cards by purchasing third-party gift cards. In order to redeem the Target gift cards, a coconspirator would send Zhang a message on his cell phone containing the gift card numbers and redemption codes immediately after the victims had purchased them. Zhang would then redeem the cards within minutes of receiving the message by scanning a bar code displayed on his cell phone. To avoid detection by Target personnel, Zhang would use the self-checkout registers for his transactions and would travel to multiple Target stores each day.

                                                        For example, according to the indictment, on May 31, 2018, an individual claiming to be an IRS employee contacted a victim in Iowa, said the victim owed more than $4,000 in taxes, and threatened the victim with arrest. The IRS impersonator then demanded that the victim go to the nearest Target store and purchase two $2,000 gift cards, which the scammer claimed that the IRS used as “Taxpayer Identification Forms.” The victim complied, used cash to purchase the gift cards, and provided the card numbers and activation codes to the IRS impersonator. The impersonator then instructed the victim to purchase an additional gift card for $2,000 to have the “arrest warrant” removed. The victim purchased a third $2,000 gift card

                                                        Target surveillance cameras showed the victim leaving the Target store in Iowa after purchasing the third gift card. Thirty minutes later, Zhang used that same gift card at a Target store in Minnesota to purchase $1,000 worth of prepaid third-party gift cards issued by Google Play™ and Steam™. He then traveled to another Target store in Minnesota and used the remaining $1,000 to purchase additional Google Play and Steam cards. Zhang was arrested at a Target store in Andover, Minnesota, and at the time of his arrest had in his possession several hundred third-party gift cards worth tens of thousands of dollars.

                                                        Zhang knew the funds he was handling were obtained through criminal activities and admitted that between May 28, 2018 and June 8, 2018, he had redeemed approximately $240,000 worth of Target gift cards by conducting hundreds of transactions. He further admitted that between March 1, 2018 and May 28, 2018, he had traveled to Colorado and conducted more than $10,000 in similar transactions.

                                                        Zhang was sentenced to 11 months’ imprisonment, with credit for time served, plus two years of supervised release and up to 20 hours of community service per week until employed. Zhang was further ordered to pay $133,800.52 in restitution to the victims.

                                                        • [1] The facts in this case narrative come from the following publicly available documents: D. Minn. Crim. Compl. filed June 8, 2018; D. Minn. Indict. filed July 10, 2018; D. Minn. Plea Agr. filed Oct.23, 2018; D. Minn. Judgment filed Mar. 14, 2019.


                                                        • Indictment Unsealed - Three More Individuals Plus a Business Charged in IRS Impersonation Scam [1]

                                                          On March 8, 2019, in the Northern District of Georgia, an indictment was unsealed revealing charges against three individuals and a business who allegedly engaged in a scheme to impersonate U.S. Government officials in order to extort money from victims. Defendants Mohit Devendrabhai Sharma, Julliette Belle Carter, Kunal Jagdishbhai Sharma, and Skyz International Outsourcing and BPO were charged with wire fraud conspiracy and wire fraud. Mohit Sharma and Carter each were charged with conspiracy to commit money laundering as well.

                                                          The indictment alleges that from about February 2014 through about November 2017, the four defendants knowingly and willfully conspired with each other and others to unjustly enrich themselves by impersonating Federal officials and inducing victims to pay fictitious back taxes, fines, and penalties.

                                                          Specifically, the defendants allegedly contacted victims located across the United States by telephone and purported to be an official from the Internal Revenue Service (IRS) seeking to collect outstanding taxes, penalties, or fines. They would also routinely leave voicemail messages threatening the victims with an “enforcement action” if they did not immediately return the call and would threaten the victims with prosecution or arrest if the alleged debts were not paid immediately. The conspirators obtained the victims’ personally identifiable information, used purchased “Lead Lists,” and followed IRS impersonation call scripts that included fraudulent IRS employees’ names and Internal Revenue Code sections.

                                                          The callers instructed the victims to go to banks or ATMs to withdraw money and then send the money electronically using banks or money service businesses such as MoneyGram®. Mohit Sharma, Carter, and others would then retrieve the fraudulent proceeds from various MoneyGram locations.

                                                          If convicted, the defendants could face a maximum statutory sentence of 20 years’ imprisonment for wire fraud.

                                                          • [1] The facts in this case narrative come from the following publicly available documents: N.D. Ga. Indict. filed May 15, 2018; N.D. Ga. Crim. Docket as of Apr. 4, 2019.


                                                          • Las Vegas Tax Business Owner Indicted in Scheme to Defraud Using Stolen Client Information and Fraudulent Financial Information [1]

                                                            On March 20, 2019, in the District of Nevada, North Las Vegas resident King Umoren was indicted for wire fraud, aggravated identity theft, and money laundering, in connection with a scheme to defraud the buyer of his tax preparation businesses.

                                                            According to the indictment, Umoren operated tax preparation businesses known as Universal Tax Services and Prudential Tax Solutions, collectively referred to as UTS. Around May 2016, Umoren began attempting to sell UTS. In about August 2017, a buyer and Umoren entered into negotiations for the sale of UTS. The buyer agreed to purchase UTS for a total price of $6.7 million, with a guaranteed $4.05 million to be paid to Umoren upon the closing of escrow, which occurred in November 2017.

                                                            From about May 2016 through about May 2018, Umoren allegedly devised and participated in a scheme to defraud and to obtain money through false representations by misrepresenting that UTS had a vastly greater client base and annual revenue than it actually did.

                                                            As part of his scheme, Umoren allegedly provided client lists and a client database containing approximately 12,700 clients to the buyer purporting to show that the clients were UTS clients, when, in fact, only about 700-800 of the individuals were actually UTS clients. Umoren stole most of the client information from unrelated companies, including the client names, Social Security Numbers, and confidential taxpayer information of those companies. Additionally, Umoren provided the buyer with fraudulent bank statements, deposit reports, personal income tax returns, Forms 1099-MISC purporting to reflect millions of dollars paid to contractors for preparing tax returns for UTS clients, and other false financial reports.

                                                            If convicted, Umoren could face a maximum statutory sentence of 20 years’ imprisonment for wire fraud, plus a mandatory two-year sentence for aggravated identity theft. Additionally, upon conviction of any of the felony offenses charged in the indictment, Umoren may be ordered to forfeit at least $4.05 million and real property. A jury trial is scheduled to begin on May 20, 2019.

                                                            • [1] The facts in this case narrative come from the following publicly available documents: D. Nev. Indict. filed Mar. 20, 2019; D. Nev. Crim. Docket as of Mar. 27, 2019.


                                                            • Tax Preparer Charged for Using Customer Information in Scheme to Defraud [1]

                                                              On March 13, 2019, in the District of Utah, Liberty Tax Service® employee Brittany Schalk was charged with wire fraud and aggravated identity theft in a scheme to defraud the Internal Revenue Service (IRS) and financial institutions.

                                                              According to the court document, Schalk was employed by Liberty Tax Service as a tax preparer and eventually as an office manager. Her employment granted her access to large amounts of personally identifiable information (PII), including, but not limited to, names, addresses, Social Security Numbers (SSN), dates of birth, and bank account information. Records containing such PII were maintained within the normal course of Liberty Tax Service’s business.

                                                              From about December 2013 through about February 2016, Schalk allegedly engaged in a scheme to defraud the IRS and financial institutions by seeking to obtain the payment and allowance of fraudulent claims. Schalk allegedly obtained the PII of customers and potential customers of Liberty Tax Service, as well as PII that had been stolen from individuals in burglaries, and used this information to create and file false tax returns, to alter and cash fraudulent checks, and to apply for fraudulent credit accounts.

                                                              For example, in furtherance of her scheme, Schalk is alleged to have changed the disbursement method for a tax refund that was to be issued to an actual Liberty Tax customer from a check to a prepaid debit card under her (Schalk’s) control. She also used the PII of another customer whose Federal income tax return she had completed in order to cash a fraudulent check. Another victim had started a tax return at Liberty Tax, but did not have the money to pay, so she never finished her return. Schalk subsequently added a fraudulent dependent to the unfinished tax return and filed it, claiming a refund of $5,316. Additionally, Schalk filed a fraudulent tax return and applied for two separate credit cards using the identity and PII of an individual whose wallet had been stolen approximately three months earlier.

                                                              If convicted, Schalk could face a maximum statutory sentence of 20 years’ imprisonment for wire fraud, plus a mandatory two-year sentence for aggravated identity theft.

                                                              • [1] The facts in this case narrative come from the following publicly available documents: D. Utah Felony Information filed Mar. 13, 2019.


                                                              • April 25, 2019

                                                                IRS Employee Indicted For Wire Fraud, Theft of Government Property, and Aggravated Identity Theft [1]

                                                                On March 6, 2019, in the Middle District of Tennessee, Internal Revenue Service (IRS) employee Tracey Allison was indicted for wire fraud, theft of Government property, and aggravated identity theft, in a scheme to fraudulently obtain paid military leave and benefits from the IRS.

                                                                According to the indictment, Allison has been employed with the IRS in Franklin, Tennessee, since October 2007. From about November 2013 through about October 2018, Allison allegedly knowingly devised a scheme to defraud and to obtain money by means of materially false and fraudulent pretenses, willingly stole property belonging to the United States, and used one or more means of identification of another without authority.

                                                                Specifically, between 2013 and 2018, Allison regularly submitted false Department of the Army Forms 1380 (DA 1380) to the IRS payroll unit seeking payment for military duties. Allison, however, was discharged from the U.S. Army Reserve in August 2012 and enlisted in the Tennessee National Guard until July 2018. Consequently, she had no military duties for the dates listed on the forms. In furtherance of Allison’s scheme, she forged the name, title, and Department of Defense identification number of her former station commander on the Forms DA 1380. Yet, her former station commander was a military retiree who ceased supervising Allison’s military duties around July 2013. Allison was not authorized to use his or her personal identifiers.

                                                                In all, Allison submitted approximately 70 false, fraudulent, and forged Forms DA 1380 to the IRS. As a result of the false submissions, Allison collected payments and benefits totaling approximately $22,846.

                                                                If convicted, Allison could face a maximum statutory sentence of 20 years’ imprisonment for wire fraud, plus a mandatory two-year sentence for aggravated identity theft.

                                                                • [1] The facts in this case narrative come from the following publicly available documents: M.D. Tenn. Indict. filed Mar. 6, 2019.


                                                                • IRS Employee Indicted for the Unauthorized Disclosure of Suspicious Activity Reports [1]

                                                                  On February 28, 2019, in the Northern District of California, Internal Revenue Service (IRS) employee John C. Fry was indicted for the unauthorized disclosure of Suspicious Activity Reports (SARs), misuse of a Government computer, and misuse of a Social Security Number (SSN) in violation of the law.

                                                                  According to the court documents, Fry is an investigative analyst for IRS Criminal Investigation (IRS-CI) in San Francisco, California, and has worked for the IRS since 2008. In this position, he had access to various law enforcement databases, including the Financial Crimes Enforcement Network (FinCEN) and Palantir, which is analytic software used by IRS-CI. FinCEN manages the collection and maintenance of SARs, which financial institutions are required to generate under the Bank Secrecy Act to report potentially suspicious financial transactions. The disclosure of a SAR or its contents is unlawful, and employees or agents of Government authorities are prohibited from disclosing a SAR, or any information that would even reveal the existence of a SAR, except as necessary to fulfill official duties.

                                                                  By virtue of his position as an investigative analyst, Fry intentionally exceeded authorized access to a computer and obtained information regarding SARs that was not necessary to fulfill his official duties. Further, between about May 4, 2018 and May 14, 2018, Fry knowingly disclosed the SARs by verbally describing and electronically sending images of the SARs to Newport Beach, California, attorney Michael Avenatti.

                                                                  Specifically, on May 4, 2018, Fry conducted numerous searches from his work computer in the Palantir database that related to Michael Cohen and his business, Essential Consultants, LLC. During this access, Fry obtained and downloaded five SARs. Immediately after downloading the five SARs, Fry placed two outgoing phone calls to a number associated with Avenatti. Fry then logged into the FinCEN database from his work computer and conducted additional searches related to Michael Cohen, including searches using Cohen’s driver’s license and personal bank account numbers, as well as several business bank account numbers. On May 7, 2018, Fry again conducted searches in the FinCEN database, this time using Cohen’s SSN and the term Essential Consultants, among other things, and later that day, placed another call to Avenatti.

                                                                  On May 8, 2018, Avenatti circulated a dossier on his public Twitter account releasing the confidential banking information related to Cohen and his company, Essential Consultants. On May 8, 2018, The Washington Post published an article that discussed in detail claims about Cohen’s banking history made public in Avenatti’s dossier. On May 12, 2018, Fry placed an outgoing call to a number later identified as being associated with a reporter. On May 16, 2018, The New Yorker published an article written by this reporter titled, “Missing Files Motivated the Leak of Michael Cohen’s Financial Records.” The article reported that the source, identified only as a law enforcement officer, grew alarmed after being unable to find two important SARs regarding Cohen’s financial activity. In fact, access to the two SARs in question had been restricted and they were not available to all FinCEN users.

                                                                  Fry confessed to verbally providing SAR information to Avenatti and to sending Avenatti a screenshot of the narrative. Fry indicated the reporter had contacted him (Fry) to verify the information supplied to the reporter by Avenatti.

                                                                  If convicted, Fry could face a maximum of five years’ imprisonment for each violation.

                                                                  • [1] The facts in this case narrative come from the following publicly available documents: N.D. Cal. Crim. Compl. filed Feb. 4, 2019; N.D. Cal. Indict. filed Feb. 28, 2019.


                                                                  • New Jersey Accountant Pleads Guilty to Bribery of IRS Agent [1]

                                                                    On February 20, 2019, in the District of New Jersey, Certified Public Accountant Hamed Aref was charged with and pled guilty to bribery of an Internal Revenue Service (IRS) revenue agent. Specifically, Aref knowingly gave the revenue agent approximately $3,000 to influence the outcome of an audit by reducing his client’s tax liability.

                                                                    According to the court documents, Aref was the accountant and held power of attorney for an individual who was being audited by the IRS. In February 2012, an IRS revenue agent met with Aref, who offered payment to the revenue agent if the revenue agent could “help out” by reducing his client’s tax liability. The revenue agent reported this meeting to law enforcement. In a subsequent recorded meeting, the revenue agent produced a false audit report reflecting the reductions in income that Aref had requested. Aref then asked the revenue agent to leave the office and left an envelope containing $3,000 in cash on the revenue agent’s chair. Aref told the revenue agent that his client was aware of the cash payment, and that his client provided the cash to Aref for the payment.

                                                                    Aref could face a maximum sentence of two years’ imprisonment. Sentencing is scheduled for June 6, 2019.

                                                                    • [1] The facts in this case narrative come from the following publicly available documents: D.N.J. Crim. Docket as of Feb. 25, 2019; and D.N.J. Information filed Feb. 20, 2019.


                                                                    • Miami Tax Services Provider Pleads Guilty to Forcibly Assaulting and Threatening IRS Employee With Shotgun [1]

                                                                      On February 13, 2019, in the Southern District of Florida, tax services provider Jimmy Sierra pled guilty to forcibly assaulting, impeding, and intimidating an Internal Revenue Service (IRS) revenue officer who was engaged in the performance of his official duties. Special agents of the Treasury Inspector General for Tax Administration arrested Sierra for the offense in May 2018, and he was subsequently indicted in June 2018.

                                                                      According to the court documents, on or about May 21, 2018, the revenue officer conducted a field visit to collect a tax payment from a tax business in Miami, Florida, of which Sierra is a registered agent. Upon arrival, the revenue officer identified himself to Sierra as an IRS employee and presented his IRS credentials. Sierra subsequently invited the revenue officer inside. Once they were inside Sierra’s office, Sierra pushed a button on his phone and another male showed up in his office. Sierra opened a drawer in his desk and pulled out what appeared to be a shotgun, pointed it at the unarmed revenue officer, and stated in part, “You want money…? I’m going to shoot you. You want it in the balls or you want it in the chest?” The revenue officer believed that Sierra had a fully functioning firearm and intended to shoot him. At that time, the revenue officer backed away, again displayed his IRS-issued credentials, and called 911.

                                                                      Sierra again stated aloud to the other male that he was going to shoot the revenue officer. The revenue officer, believing that he was in a fight for his life, grabbed the shotgun stock and wrestled with Sierra over the weapon. During the exchange, Sierra struck the revenue officer, who sustained injuries. The revenue agent was able to flee Sierra’s office and was later transported to a hospital for medical attention.

                                                                      Sierra could face a maximum sentence of eight years’ imprisonment. Sentencing is set for April 26, 2019.

                                                                      • [1] The facts in this case narrative come from the following publicly available documents: S.D. Fla. Crim. Compl. filed May 23, 2018; S.D. Fla. Indict. filed June 5, 2018; S.D. Fla. Plea Agr. filed Feb. 13, 2019; S.D. Fla. Factual Proffer filed Feb. 13, 2019; S.D. Fla. Crim. Docket as of Feb. 20, 2019.


                                                                      • March 27, 2019

                                                                        IRS Supervisor Pleads Guilty to Theft of Government Property [1]

                                                                        On January 31, 2019, in the Central District of California, Internal Revenue Service (IRS) supervisor Leslie Williams pled guilty to two counts of theft of Government property. Williams was initially indicted for the offenses and arrested by special agents of the Treasury Inspector General for Tax Administration (TIGTA) in March 2018.

                                                                        According to the court documents, at all times relevant to the charges, Williams was employed by the IRS as a supervisory individual tax advisory specialist in the Long Beach, California office. Beginning on or about February 12, 2016, Williams knowingly and willfully embezzled, stole, and converted for her own use Federal funds as the purported surviving spouse of her ex-husband, who had died on about January 22, 2016, and from whom she had been divorced since about November 15, 2013. Specifically, Williams claimed that, as the alleged surviving spouse, she was entitled to receive death benefit payments issued by the Office of Personnel Management (OPM), as well as retirement plan contributions issued by the Federal Retirement Thrift Investment Board (FRTIB). In total, Williams stole $34,204.50 from OPM and $36,861 from FRTIB.

                                                                        Additionally, on February 14, 2017, when interviewed by TIGTA special agents, Williams allegedly made a materially false statement by continuing to claim that she was married to her ex-spouse until his death, when, in fact, Williams knew she had been divorced since about November 15, 2013.

                                                                        Williams could face a maximum statutory sentence of 10 years’ imprisonment. Sentencing in this matter is scheduled for June 3, 2019.

                                                                        • [1] The facts in this case narrative come from the following publicly available documents: C.D. Cal. Indict. filed Mar. 21, 2018; C.D. Cal. Executed Arrest Warrant filed. Mar. 22, 2018; C.D. Cal. Plea Agr. filed Jan. 31, 2019; C.D. Cal. Crim. Docket as of Feb. 5, 2019.


                                                                        • Michigan Man Sentenced to More Than 13 Years in Prison for Scheme to Defraud the IRS [1]

                                                                          On January 29, 2019, in the Western District of Michigan, Oghenevwakpo Igboba was sentenced for conspiracy to defraud the United States, wire fraud, false claims, and aggravated identity theft. Igboba was initially indicted for the offenses and arrested by special agents of the Treasury Inspector General for Tax Administration in February 2017.

                                                                          According to the court documents, from at least December 2014 to about February 2016, Igboba conspired with others to defraud the Internal Revenue Service (IRS) by knowingly devising and participating in a scheme to obtain income tax refunds by means of fraudulent representations. Igboba coordinated the conspiracy, which involved at least five participants, including his father, his sister, codefendant Charles Aghogho Ejinyere, and other individuals

                                                                          As part of the scheme, Igboba and his coconspirators obtained personally identifiable information (PII), including the names, dates of birth, addresses, telephone numbers, Social Security Numbers, and familial information of numerous unrelated individuals. Using that PII, Igboba and others illegally accessed online IRS systems, including eAuthentication and Get Transcript, to obtain additional tax-related information for the individuals. They then filed or caused to be filed without authorization fraudulent tax returns with the IRS in the names of the individuals. Igboba and coconspirator Ejinyere directed refunds from the fraudulent returns to be deposited into bank and credit union accounts belonging to Igboba, his businesses, his family members, associates, and unwitting accomplices.

                                                                          In September 2018, a jury found Igboba guilty of 18 counts of the 22-count indictment. The intended loss for the fraudulent tax refunds totaled more than $4 million.

                                                                          Igboba was sentenced to 162 months’ imprisonment followed by three years of supervised release. He was further ordered to pay $514,823 in restitution to the IRS and to forfeit $48,205.

                                                                          • [1]The facts in this case narrative come from the following publicly available documents: W.D. Mich. Indict. filed Feb. 7, 2017; W.D. Mich. Govt. Trial Brief filed Apr. 6, 2018; W.D. Mich. Verdict Form filed Sep. 17, 2018; W.D. Mich. Govt. Sentencing Memorandum filed Jan. 23, 2019; W.D. Mich. Judgment filed Jan. 31, 2019; W.D. Mich. Crim. Docket as of Feb. 5, 2019.


                                                                          • New Jersey Tax Preparer Sentenced in Scheme Involving Filing of False Tax Returns and Bank Fraud [1]

                                                                            On December 21, 2018, in the District of New Jersey, tax preparer Brian A. Day was sentenced in connection with a scheme to defraud the Internal Revenue Service (IRS) and misappropriate his clients’ monies by the filing of false tax returns and bank fraud. Day previously pled guilty to the offenses in August 2018.

                                                                            According to the court documents, Day, a resident of Port Murray, New Jersey, was self-employed as a tax return preparer. He was the sole owner and operator of various tax preparation businesses located in Essex County, New Jersey, including PTS, Tax Consultants, and Tax Consultants, LLC. Day met with taxpayers and collected information relating to the preparation of their individual income tax returns.

                                                                            Day knowingly and intentionally executed a scheme to defraud and obtain money by means of false and fraudulent representations. The purpose of the scheme was for Day to misappropriate money from his taxpayer clients by falsely advising them that they owed tax payments to the IRS and directing them to give him checks made payable to the IRS in order to resolve their purported IRS liabilities. In fact, Day did not actually give the checks from his taxpayer clients to the IRS. Instead, he altered the names of the payees on the checks from the “IRS” to names matching or resembling that of one of his tax preparation businesses and deposited the checks into his own business bank account. Day made false or fraudulent representations to at least five individuals, resulting in a total loss of approximately $124,289.

                                                                            According to the indictment, when Day’s clients contacted him regarding their checks, he presented fraudulent documents purportedly issued by the IRS to two of the taxpayers in an attempt to conceal and further his fraud. However, the IRS never issued these documents. Additionally, Day prepared or presented at least 21 fraudulent and false tax returns to the IRS for Tax Years 2009 through 2015, resulting in a loss to the IRS of approximately $491,007.

                                                                            Day was sentenced to 32 months’ imprisonment, followed by five years’ supervised release. He was further ordered to forfeit $61,000, pay $499,997.72 in restitution, and pay a special assessment fee of $800.

                                                                            • [1]The facts in this case narrative come from the following publicly available documents: D.N.J. Indict. filed Feb. 1, 2017; D.N.J. Plea Agr. filed Aug. 1, 2018; D.N.J. Consent Judgment and Order of Forfeiture filed Aug. 1, 2018; and D.N.J. Judgment filed Dec. 21, 2018.


                                                                            • February 28, 2019

                                                                              California Man Pleads Guilty to Misuse of the Department of the Treasury Symbol [1]

                                                                              On December 11, 2018, in the Central District of California, Cody Jannetti pled guilty to misusing a U.S. Treasury symbol in association with a false release of levy. Jannetti was initially charged with the offense on November 1, 2018. November 8, 2018, in the Middle District of Florida, former Internal Revenue Service (IRS) employee Dawn Avalle pled guilty to conspiracy to defraud the United States and making and subscribing to a false tax return. Avalle was initially charged with the offenses on October 24, 2018.

                                                                              According to the court documents, Jannetti owed the Internal Revenue Service (IRS) approximately $107,000 in delinquent taxes. In late 2016, the IRS issued a levy on Jannetti’s income to his employer, Loan Depot.

                                                                              Jannetti manipulated an IRS Release of Levy on his work computer and forged the signature of an IRS employee. Additionally, Jannetti changed the fax header to note that it had been sent from the IRS, when Jannetti had faxed it to himself from a Federal Express office. On or about January 5, 2017, Jannetti then faxed the false IRS levy release to Loan Depot in order to convey the impression that his tax lien was released and that he could have access to his income.

                                                                              Jannetti could face a maximum statutory sentence of one year in prison, plus a fine of up to $10,000 for each use. Sentencing has been scheduled for February 25, 2019.

                                                                              • [1] The facts in this case narrative come from the following publicly available documents: C.D. Cal. Information filed Nov. 1, 2018; C.D. Cal. Plea Agr. filed Nov. 1, 2018; C.D. Cal. Crim. Docket as of Dec. 12, 2018.


                                                                              • Georgia Man Offers IRS Employee $30,000 to Falsify Audit Results [1]

                                                                                On November 6, 2018, in the Northern District of Georgia, Magdaleno Garcia Alonso was indicted for corruptly offering a thing of value to an employee of the United States. Alonso was subsequently arrested for the offense on November 10, 2018, by special agents of the Treasury Inspector General for Tax Administration.

                                                                                According to the court documents, on or about September 19, 2018, Alonso offered an Internal Revenue Service (IRS) revenue agent $30,000, with the intent to induce the revenue agent to commit an act in violation of his or her lawful duties, that is, to falsify the results of audits of Alonso’s and Georgia Concrete, Incorporated’s Federal income tax returns for tax years 2015 and 2016.

                                                                                Alonso is detained pending trial and could face a maximum statutory sentence of 15 years’ imprisonment.

                                                                                • [1] The facts in this case narrative come from the following publicly available documents: N.D. Ga. Indict. filed Nov. 6, 2018; N.D. Ga. Order of Detention filed Nov. 13, 2018; N.D. Ga. Executed Arrest Warrant filed Nov. 19, 2018; N.D. Ga. Crim. Docket as of Nov. 28, 2018.


                                                                                • California Man Pleads Guilty for His Role in an Impersonation Scam [1]

                                                                                  On October 23, 2018, in the District of Minnesota, Yu Zhang pled guilty to conspiracy to commit wire fraud in connection with an interstate scheme to defraud by falsely impersonating Internal Revenue Service (IRS) employees. Zhang was indicted for the offense in July 2018.

                                                                                  According to the court documents, from at least March 12, 2018 to June 8, 2018, Zhang conspired with others to participate in a scheme to defraud and to obtain money by material false and fraudulent pretenses. Zhang’s coconspirators contacted victims in numerous States throughout the country by telephone, falsely claimed to be IRS agents or other Government officials, and threatened the victims with arrest unless they made immediate payment for delinquent taxes.

                                                                                  The callers instructed the victims to go to Target™, purchase gift cards, and provide the gift card numbers and activation codes to the callers over the phone. Zhang, at the direction of his coconspirators, traveled to Target stores in multiple States, including Minnesota, Illinois, and Colorado, to redeem the Target gift cards by purchasing third-party gift cards. In order to redeem a Target gift card, a coconspirator would send Zhang a message on his cell phone containing the gift card number and redemption code immediately after the victim had purchased it. Zhang would then redeem the card within minutes of receiving the message by scanning a bar code displayed on his cell phone. To avoid detection by Target personnel, Zhang would use the self-checkout registers for his transactions and would travel to multiple Target stores each day.

                                                                                  For example, according to the indictment, on May 31, 2018, an individual claiming to be an IRS employee contacted a victim in Iowa, said the victim owed more than $4,000 in taxes, and threatened the victim with arrest. The IRS impersonator then demanded that the victim go to the nearest Target store and purchase two $2,000 gift cards, which the scammer claimed that the IRS used as “Taxpayer Identification Forms.” The victim complied, used cash to purchase the gift cards, and provided the card numbers and activation codes to the IRS impersonator. The impersonator then instructed the victim to purchase an additional gift card for $2,000, to have the “arrest warrant” removed. The victim purchased a third $2,000 gift card.

                                                                                  Target surveillance cameras showed the victim leaving the Target store in Iowa after purchasing the third gift card. Thirty minutes later, Zhang used that same gift card at a Target store in Minnesota to purchase $1,000 worth of prepaid third-party gift cards issued by Google Play™ and Steam™. He then traveled to another Target store in Minnesota and used the remaining $1,000 to purchase additional Google Play and Steam cards. Zhang was arrested at a Target store in Andover, Minnesota, and at the time of his arrest had in his possession several hundred third-party gift cards worth tens of thousands of dollars.

                                                                                  Zhang knew the funds he was handling were obtained through criminal activities and admitted that between May 28, 2018 and June 8, 2018, he had redeemed approximately $240,000 worth of Target gift cards by conducting hundreds of transactions. He further admitted that between March 1, 2018 and May 28, 2018, he had traveled to Colorado and conducted more than $10,000 in similar transactions.

                                                                                  Zhang could face a maximum statutory sentence of 5 years’ imprisonment. His sentencing is set for February 27, 2019.

                                                                                  • [1] The facts in this case narrative come from the following publicly available documents: D. Minn. Crim. Compl. filed June 8, 2018; D. Minn. Indict. filed July 10, 2018; D. Minn. Plea Agr. filed Oct.23, 2018; D. Minn. Crim. Docket as of Dec. 7, 2018.



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