Hanging Out a Shingle

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Because taxes can be complicated, tax preparers are instrumental in helping the Internal Revenue Service (IRS) collect revenue from individual taxpayers. It behooves the tax agency to make sure that those involved in the tax preparation profession are competent and accountable for their actions. (Otherwise, fraudulent tax preparers steal money from their clients, which also costs the government a lot of money.) To the IRS’ credit, one Florida woman who “hung out a shingle” for her fraudulent tax preparation business is now being held accountable for her criminal actions.

For four tax years, the fraudulent tax preparation business owner provided services through two different companies located in Port St. Lucie and Miami. During that time, she prepared and submitted individual tax returns on behalf of her clients claiming false deductions. (She also filed a few false returns in her own name while she was at it, claiming that she had five different dependents, when she didn’t.)

Today’s fraudster was charged in a 52-count indictment for running her fraudulent tax preparation business with the intent to file bogus tax returns on behalf of her clients. She pleaded guilty to only five of the charges. Consequently, the 40-year-old Port St. Lucie resident was sentenced to two-and-a-half years in prison to be followed by one year of supervised release. If this fraudster had been convicted on all 52 counts, she could have been sentenced to 156 years in prison (three years for each count) and fined $5.2 million ($100,000 for each count). (Lucky for her, that was not the case.)

This tax preparer’s clients trusted her to accurately represent them, not put them at risk. It looks like the IRS didn’t leave this fraudster’s clients hanging and declared this criminal incompetent when it comes to preparing tax returns and held her accountable for her illegal actions. (This woman’s former career as a tax preparer is now over and her shingle is coming down.)

Source: Today’s “Fraud of the Day” is based on a Department of Justice press release entitled, “Port St. Lucie Resident Sentenced to 30 Months in Prison for Running Fraudulent Tax Preparation Business” released on May 18, 2017.

A Port St. Lucie resident was sentenced to 30 months in prison, to be followed by one year of supervised release, after pleading guilty to assisting in the preparation of false tax returns and filing false tax returns, in violation of Title 26, United States Code, Sections 7206(2) and (1).

Benjamin G. Greenberg, Acting United States Attorney for the Southern District of Florida, and Kelly R. Jackson, Special Agent in Charge, Internal Revenue Service, Criminal Investigation (IRS-CI), made the announcement.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.