ATTORNEY'S OFFICE FOR THE MIDDLE DISTRICT OF PENNSYLVANIA: U.S. Attorney And IRS Warn Potential Tax Cheats To Timely File Accurate And Complete Tax Returns

U.S. Attorney's Office for the Middle District of Pennsylvania issued the following announcement on Apr. 12.

With the deadline for filing federal individual income tax returns having been extended to May 17th, 2021, and taxpayers now preparing to file their tax returns, the U.S. Attorney’s Office for the Middle District of Pennsylvania, and the Philadelphia Field Office, IRS Criminal Investigation Division, jointly announced a warning to those who are thinking about breaking the law by committing tax crimes. Willfully filing false tax returns or deliberately evading paying taxes are serious criminal offenses and can result in prison and substantial fines and penalties.

“Supreme Court Justice Oliver Wendell Holmes famously stated that taxes are what we pay for a civilized society and those words are even engraved on the exterior of the IRS building in Washington D.C.,” stated Acting U.S. Attorney Bruce D. Brandler. Those who fail to pay their fair share of taxes not only cheat the government out of much needed revenue that finances our military, health programs, and public works projects, but also cheat their fellow citizens who are forced to carry more than their share of the burden. Our office will vigorously prosecute any individual or business that willfully violates our tax laws.”

“Tax fraud schemes, such as employment tax fraud, refund fraud, and identity theft harm everyone,” said IRS Special Agent in Charge Thomas Fattorusso. “These schemes serve no purpose except to defraud the IRS and the American Public. Would-be tax cheats are reminded that IRS-CI uses all its investigative tools to uncover and put a stop to such fraud.”

Throughout the past year, the U.S. Attorney’s Office prosecuted a broad array of tax offenses including tax evasion, employment tax fraud, and refund fraud. Enforcement efforts are continually ongoing. Here are a few recent examples:

Tax Evasion

• On March 5, 2021, a 54-year-old Old Forge man was sentenced to three years of probation and ordered to pay $117,370 in restitution for tax evasion. Christopher Jones failed to report over $500,000 in taxable income between 2014 and 2019 to avoid paying federal income taxes. Jones failed to report income he gained from illegal bookmaking activities and made false statements to federal agents in February 2019 during the investigation. The judge noted that but for COVID, Jones would have had to serve prison time, but his medical conditions placed him at high risk.

Prosecution of Business Owners

• On January 27, 2021, Lynn and Richard Mineo of Old Forge, Pennsylvania, pled guilty to tax evasion. The Mineos, who are husband and wife, failed to report a total of $550,469.92 in income between tax years 2014 ($145,205), 2015 ($169,346), 2016 ($153,749), and 2017 ($82,168).  The income was for the Mineos’ business, a beer retail store called Mineo’s Brewer’s Outlet, located in Dunmore, Pennsylvania.
• On February 23, 2021, a 36-year-old Harrisburg man was sentenced to two years of probation and ordered to pay $360,897.86 in restitution for conspiring to defraud the United States by failing to pay employment taxes. Darasomalee Thach co-owned and operated a temporary staffing company in Harrisburg and failed to withhold and pay employment taxes from 2011 through 2015, in order to maximize his personal profit.
• On March 5, 2021, Matthew Forney of Camp Hill, was sentenced to one year and one day imprisonment and ordered to pay a $40,000 fine, and Kim Forney, of Windsor, was sentenced on March 4, 2021, to one year imprisonment, for failing to include earnings made through their business on their federal income tax returns for the years 2014 through 2017. The Forneys deposited checks from their business sales into the business bank account, which was reported as taxable income on their tax returns, along with credit card sales. However, the Forneys retained any cash from their business sales at their residence. The Forneys did not report this cash as taxable income on their tax returns or pay taxes on these monies. The unreported income for these years totaled $817,713, which resulted in $292,066 in unpaid taxes.
• On March 31, 2021, Andrea and Guiseppe Tomasino, co-owners of Tomasino’s Restaurante Italiano, located in Dallas, Pennsylvania, pled guilty to failing to collect and pay required federal payroll taxes. Andrea and Guiseppe Tomasino, who were responsible, as co-owners of Tomasino’s Restaurant Italiano, for collecting and paying to the Internal Revenue Service federal payroll taxes, including Federal Insurance Contribution Act (FICA) taxes, willfully failed to pay to the IRS these required taxes for a period from the first quarter of 2014 through the first quarter of 2019, in the total amount of $95,710. 

Stolen Identity Refund Fraud

• On March 9, 2021, a 38-year-old Allentown woman was sentenced to 75 months’ imprisonment for conspiring to defraud the government between January 2015 to July 2016.  Marien Torres-Acevedo and her conspirators obtained fraudulent U.S. Treasury checks by stealing victims’ identities and using those stolen identities to file false tax returns that generated significant refunds.  Torres-Acevedo and her conspirators then secured the fraudulent U.S. Treasury checks and cashed them at various check cashing businesses, including several in Pennsylvania.  Torres-Acevedo admitted that between $550, 000 and $1.5 million in losses occurred as a result of the criminal activity. Torres-Acevedo was ordered to pay $857,729.65 in restitution.
• On April 1, 2021, a 44-year-old Allentown man was sentenced to 70 months’ imprisonment for conspiring to defraud the government and for committing aggravated identity theft. Julio Polanco Suarez and his conspirators obtained fraudulent U.S. Treasury checks by stealing victims’ identities and using those stolen identities to file false tax returns that generated significant refunds.  The conspirators then secured the fraudulent U.S. Treasury checks and cashed them at various check cashing businesses, including several in Pennsylvania.  Suarez admitted that between $1.5 million and $3.5 million in losses to the U.S. Treasury occurred as a result of the criminal activity. Suarez was also ordered Suarez to pay $1,189,256.50 in restitution.  Coconspirators received sentences ranging from three years’ probation to 75 months’ imprisonment. Suarez faces deportation at the conclusion of his sentence of imprisonment.

Fraudulent FormsOn March 26, 2021, Eric Judkins pled guilty to conspiracy to defraud the Internal Revenue Service.  Judkins and his co-defendant, Larry Benavides and others, ran a scheme between January 2011 and October 2012, at USP Allentown in which they would fill out fraudulent IRS Forms 1040EZ to claim refunds. The scheme also included selling completed forms to other inmates for a price, after which Judkins and Bernavides would pocket the money and the inmate would claim the bogus refund himself. From early 2011 until 2012, approximately 80 false returns were filed with the IRS on behalf of multiple inmates.  Judkins directed that the refunds be sent to individuals outside of prison which involved setting up individuals outside of prison as Powers of Attorney so that they could cash the checks and deposit the money into the inmates’ commissary accounts.  Searches of the inmates’ cells resulted in recoveries of IRS forms.  The total amount of refunds claimed by the conspiracy was $108,855 of which Judkins or individuals directed by Judkins claimed $11,031.37.  The total amount of refunds issued by the IRS was $26,735, of which $7,194 went to Judkins and his direct associates. Benavides previously pleaded guilty in the Western District of Pennsylvania and is awaiting sentencing.

Tax Scam Warning

The U.S. Attorney’s Office and the IRS remind tax payers to exercise caution during tax season to protect themselves against tax schemes ranging from identity theft to return preparer fraud. Illegal scams can lead to significant penalties and interest and possible criminal prosecution. IRS Criminal Investigation works closely with the Department of Justice to shutdown scams and to prosecute the criminals behind them.  The IRS would like to warn taxpayers of a quickly growing scam involving a phone scam whereby criminals fake calls from the Taxpayer Advocate Service (TAS), an independent organization within the IRS.

Similar to other IRS impersonation scams, thieves make unsolicited phone calls to their intended victims fraudulently claiming to be from the IRS. In this most recent scam variation, callers “spoof” the telephone number of the IRS Taxpayer Advocate Service office in Houston or Brooklyn. Calls may be ‘robo-calls’ that request a call back. Once the taxpayer returns the call, the con artist requests personal information, including Social Security number or individual taxpayer identification number (ITIN).

TAS can help protect your taxpayer rights. TAS can help if you need assistance resolving an IRS problem, if your problem is causing financial difficulty, or if you believe an IRS system or procedure isn’t working as it should. TAS does not initiate calls to taxpayers “out of the blue.” Typically, a taxpayer would contact TAS for help first, and only then would TAS reach out to the taxpayer.

In other variations of the IRS impersonation phone scam, fraudsters demand immediate payment of taxes by a prepaid debit card or wire transfer. The callers are often hostile and abusive. Alternately, scammers may tell would-be victims that they are entitled to a large refund but must first provide personal information. Other characteristics of these scams include:

• Scammers use fake names and IRS badge numbers to identify themselves.
• Scammers may know the last four digits of the taxpayer’s Social Security number.
• Scammers spoof caller ID to make the phone number appear as if the IRS or another local law enforcement agency is calling.
• Scammers may send bogus IRS emails to victims to support their bogus calls.
• Victims hear background noise of other calls to mimic a call site.
• After threatening victims with jail time or with, driver’s license or other professional license revocation, scammers hang up. Others soon call back pretending to be from local law enforcement agencies or the Department of Motor Vehicles, and caller ID again supports their claim.

Here are some things the scammers often do, but the IRS will not do. Taxpayers should remember that any one of these is a tell-tale sign of a scam.

The IRS will never:

• Call to demand immediate payment using a specific payment method such as a prepaid debit card, gift card or wire transfer. Generally, the IRS will first mail a bill to any taxpayer who owes taxes.
• Threaten to immediately bring in local police or other law-enforcement groups to have the taxpayer arrested for not paying.
• Demand that taxes be paid without giving taxpayers the opportunity to question or appeal the amount owed.
• Ask for credit or debit card numbers over the phone.
• Call about an unexpected refund.

For taxpayers who don’t owe taxes or don’t think they do:

• Please report IRS or Treasury-related fraudulent calls to phishing@irs.gov (Subject: IRS Phone Scam).
• Do not give out any information. Hang up immediately. The longer the con artist is engaged; the more opportunity he/she believes exists, potentially prompting more calls.
• Contact TIGTA to report the call. Use their IRS Impersonation Scam Reporting web page. Alternatively, call 800-366-4484.
• Report it to the Federal Trade Commission. Use the “FTC Complaint Assistant” on FTC.gov. Please add "IRS Telephone Scam" in the notes.

For those who owe taxes or think they do:

• Call the IRS at 800-829-1040. IRS workers can help.
• View tax account online. Taxpayers can see their past 24 months of payment history, payoff amount and balance of each tax year owed. 

Original source can be found here.