As tax filing season opens, IRS Criminal Investigation highlights tax fraud prosecutions

 

Date: January 29, 2020

Contact: newsroom@ci.irs.gov

As tax filing season opens this week, the IRS Criminal Investigation Dallas Field Office and the U.S. Attorney's Office for the Northern District of Texas remind citizens that falsely preparing tax returns and evading taxes are crimes.

Taxpayers can view the most current tax tips, forms and scams at www.irs.gov.

"As a new tax filing season begins this week, IRS Criminal Investigation wants to remind people to file accurate tax returns and to choose their tax preparers carefully," said Tamera Cantu, Special Agent in Charge of the Dallas Field Office. "Those who might consider preparing false and fraudulent tax returns should be aware of the extremely negative consequences that could result in prison time and large tax bills, including substantial fines, interest and penalties."

"The U.S. Attorney's Office is committed to prosecuting tax crimes," said U.S. Attorney Erin Nealy Cox. "We are grateful to our partners at IRS Criminal Investigation for rooting out tax fraud."

To underscore federal law enforcement's commitment to pursue those who fail to pay their taxes or otherwise defraud the tax system, below are several tax and tax-related fraud prosecutions that were sentenced in 2019 in the Northern District of Texas:

  • Juana Gabriela Ortiz worked for Ebenezer Olayiwola, who owned and operated Peak Insurance and Tax Service. Between 2010 and 2013, Olayiwola and his preparers filed thousands of tax returns claiming more than $35 million in fraudulent tax refunds. Olayiwola admitted to training his preparers to prepare fraudulent tax returns by adding fraudulent Schedules C forms and education credits. Olayiwola's organization generated approximately millions of dollars in tax preparation fees during that period. Olayiwola was sentenced to 60 months confinement, 3 years supervised release and restitution totaling $30,670,438.98. Ortiz prepared a significant number of false tax returns, and was ordered to pay restitution totaling $3,992,080.
  • Francisco Ventura owned numerous tax preparation businesses located in Texas. Subject assisted in teaching training classes for new tax return preparers, supervised other tax return preparers, and reviewed and submitted returns prepared at the business to the IRS. Ventura instructed employees to prepare false income tax returns utilizing false items such as Schedules C and false education credits. Ventura was sentenced to 63 months confinement, 2 years of supervised release and restitution totaling $8,310,261.
  • Idrissa Traore and Josseline Cazun-Menendez participated in a stolen identity refund fraud scheme to defraud the IRS. Cazun-Menendez opened at least 66 bank accounts using false identification documents in at least 18 different alias names and Traore opened at least 3 bank accounts in at least 2 alias names also using false identification. Traore maintained organized files of his and Cazun-Menendez's alias bank account records, debit cards, and fraudulent identification cards. A total of 159 fraudulent tax returns for tax years 2014 through 2017 were associated with fraudulent refunds deposited to the alias accounts. Traore was sentenced to 121 months confinement, 3 years of supervised release and restitution totaling $2,044,547. Cazun-Menendez was sentenced to 60 months confinement, 3 years of supervised release and restitution totaling $1,017,999.
  • Mario Antonio Melendez worked for a return preparer who owned numerous tax preparation businesses in the Dallas area. The defendant conspired with the owner to teach return preparation classes instructing employees to prepare fraudulent returns in exchange for a percentage of the owner's profits. The returns included false education credits and false American Opportunity Tax Credits and resulted in inflated refunds to be paid by the IRS. Melendez was sentenced to 51 months confinement, 1 year of supervised release and restitution totaling $3,885,456.
  • Sandra Cantu owned two tax preparation businesses in Dallas and prepared, filed, and caused to be filed income tax returns containing false Schedules A and C. During the period of 2013-2016, her scheme resulted in 1,705 fraudulent returns, 626 of which refunds were paid out. Cantu was sentenced to 48 months confinement, 1 year of supervised release and restitution totaling $1,761,189.12.

The Better Business Bureau is a non-profit that upholds standards for trustworthiness and ethics in business. BBB accepts consumer complaints against businesses and monitors the marketplace for substandard business practices.

In 2019, BBB processed approximately 1,582 reportable complaints against tax return preparers. Approximately 65 of those complaints were for preparers headquartered in the DFW area.

Consumers alleged to BBB that theft of refunds, theft of personal information and identifiers, loss or misappropriation of sensitive data, and late and inaccurate filings are the possible outcomes of choosing the wrong tax preparer.

BBB advises taxpayers to be cautious when choosing a tax preparer. You can check BBB Business Profiles at www.bbb.org. BBB provides the following tips to help you find a tax preparer you can trust:

  • Get referrals.
  • Choose a preparer that is properly registered. A tax preparer must obtain a PTIN from the IRS.
  • Look for credentials. Anyone with a PTIN can prepare your tax forms for you, but some tax preparers have more training and qualifications than others. Learn about tax preparer credentials on the IRS website.
  • Keep a watchful eye for promises. Be wary of any tax preparation service that promises larger refunds than the competition and avoid tax preparers who base their fee on a percentage of the refund.
  • Search for free tax programs. There are several free government programs that prepare taxes free of charge if you meet an income requirement. Visit the IRS's Free File page for more information.

Timely and accurate filing, in addition to thorough research on a reputable tax preparer will help north Texans navigate the new tax season with ease and confidence.