Riverside County tax preparer sentenced to 6 years in prison for preparing false returns that caused over $3 million in losses to IRS


Date: June 26, 2023

Contact: newsroom@ci.irs.gov

LOS ANGELES — An Inland Empire tax preparer was sentenced today to 72 months in federal prison for knowingly filing thousands of tax returns that falsely claimed deductions, such as fake medical expenses and bogus mortgage interest, and which caused more than $3 million in losses to the IRS.

Andrew Zepeda Hansack of Riverside, was sentenced by United States District Judge Stephen V. Wilson, who said Hansack's crimes were "one of the most serious offenses I've encountered while on the bench."

In addition to the six-year prison term, Judge Wilson ordered Hansack to pay a $50,000 fine and $3,369,886 in restitution.

Hansack pleaded guilty on February 27 to two counts of aiding and assisting in the preparation of a false tax return. Judge Wilson imposed the statutory maximum sentence for each of the two counts.

Starting in January 2015, Hansack prepared personal income tax returns at AJ Loyal Income Tax Service, a Riverside-based company. Hansack filed tax returns for some of his clients that included false itemized deductions. Specifically, Hansack filed tax returns for these clients that indicated they had paid mortgage interest for their homes, when in truth, as Hansack knew, his clients did not own a home. Hansack also claimed false medical expenses, sales tax, and gifts by cash or check on some tax returns he prepared that he knew to be false.

For the tax years 2015 through 2019, Hansack filed approximately 2,533 tax returns with false deductions on behalf of his clients, according to court documents. Because of Hansack's criminal activity, the IRS was prevented from assessing and collecting the correct amount of taxes owed by the clients. Judge Wilson found that the IRS suffered losses of approximately $3.37 million.

For example, in February 2020, Hansack aided and assisted the preparation of a federal income tax return for a South Gate resident. This tax return falsely claimed $30,488 in itemized deductions, including deductions for mortgage interest. The false and fraudulent deductions caused the South Gate taxpayer to claim a refund from the IRS in the amount of $7,318 to which the taxpayer was not entitled.

IRS Criminal Investigation investigated this matter.

Assistant United States Attorney Jeff Mitchell of the Major Frauds Section prosecuted this case.