Date: January 15, 2020
Although the filing season is just beginning, the Internal Revenue Service's Criminal Investigation Division and the U.S. Attorney's Office work year-round to protect the integrity of our nation's tax system by investigating and prosecuting individuals who violate the tax laws.
"As we approach tax filing season, IRS Criminal Investigation wants to remind people to file accurate tax returns and to choose their tax preparers carefully," said Kathy A. Enstrom, Special Agent in Charge of the Chicago Field Office. "IRS Criminal Investigation operates year-round to protect the integrity of our system of taxation and investigates those who create elaborate schemes, such as identity fraud schemes to obtain fraudulent tax refunds or tax schemes that fail to report all forms of income on their tax returns. Taxpayers are encouraged to visit the IRS.gov website for tips on filing a tax return accurately and searching for a reputable return preparer."
"Each year, millions of honest Wisconsin residents dutifully pay a portion of their hard-earned income in taxes," said United States Attorney Krueger. "They deserve to know that people who cheat on their taxes face serious consequences, including time in federal prison."
The following prosecutions over the second half of 2019 in the Eastern District of Wisconsin serve as a warning against filing a false or fraudulent tax return, and as a reminder to be wary of any schemes that would falsify income or deductions.
Richard J. Clark was sentenced on May 21, 2019 in federal court in Milwaukee to 14 months in prison, to be followed by three years of supervised release, and ordered to pay $213,000 in restitution to the IRS. Clark, who resided in Mukwonago, previously operated Foremost Realty, LLC, a real estate business that listed, maintained, and sold foreclosed property in southeastern Wisconsin. During the years 2008 – 2013, Clark, through his business, received approximately $1.6 million in commissions. Despite receiving these commissions, Clark filed tax returns that either listed $0 on all lines of the returns, reporting no income or tax obligations, or reported very minimal income and taxes. As a result, during the years 2008-2013, Clark evaded more than $400,000 in federal income taxes.
June 18, 2019 John Miller Ragland, who previously resided in Menomonee Falls, Wisconsin, appeared in federal court and pleaded guilty to attempting to evade his federal income taxes, in violation of 26 U.S.C. § 7201. Ragland operated a number of business ventures through which he acted as an independent sales representative in the United States and elsewhere, including Hong Kong, China. John Miller Ragland was sentenced in federal court to six months in prison, to be followed by one year of supervised released, and ordered Ragland to pay $1.4 million in restitution to the IRS.
Also, in June Steven M. Rader of Muskego, Wisconsin, was sentenced to five months in federal prison for stealing more than $89,000 from the federal government via a tax evasion scheme that began in 2012. Rader was also ordered to pay more than $195,000 in restitution. Rader's tax evasion scheme related to an entertainment business he owned and operated starting in 2012. Despite the fact that the business generated significant income, Rader failed to report any of that income on his federal tax returns for the years 2012 to 2014. In total, Rader understated his income by over $500,000 and underpaid his taxes by over $89,000. Radar also made significant efforts to conceal his tax evasion by filing false amended tax returns and lying to federal investigators about his sources of income.
On October 18, 2019 Lisa A. Radtke, of Appleton, Wisconsin, appeared in federal court in Green Bay and pleaded guilty to one count of wire fraud (18 U.S.C. §1343) and one count of tax evasion (26 U.S.C. § 7201). Based on her guilty pleas, Radtke faces up to 25 years in prison and fines of up to $500,000, or both. Radtke also agreed to make restitution to her former employer, which was the victim of her fraud, in the amount of $1.3 million, as well as to the Internal Revenue Service for the taxes she failed to pay, plus penalties and interest on these taxes, in the amount of $634,000. Radtke's sentencing is scheduled for January 27, 2020, also in Green Bay.
Philip Kuehnl of Pleasant Prairie, WI, pleaded guilty in December 2019 to filing a false tax return and mail fraud. In 2015, Kuehnl was charged with 20 counts of Title 18, 1001 and 1341, and Title 26, 7206(1) filing a false tax return. He operated a medical device scheme from 2005 to April 2011 in which he fraudulent obtained more than $700,000 from customers who purchased medical devices falsely believing the devices were from legitimate medical supplier. He also substantially underreported and underpaid his federal income taxes for tax years 2007 through 2009. Kuehnl failed to report over $978,00 of income over a three year period and $290,000 in federal income taxes. Kuehnl was a fugitive. His sentencing is scheduled for January 26, 2020.
Ana Delia Dominguez Alvarez and Alberto Fernando Ramirez were indicted in 2017 on 23 charges of conspiracy, theft of government funds, and aggravated identity theft and both pleaded guilty in December 2019. They operated a tax fraud scheme from November 2010 to May 2017 in which they obtained ITIN numbers from individuals in Mexico and filed false federal tax returns using the ITIN numbers. They falsely claimed the additional tax child credit on tax returns. Ana Dominguez worked for a tax preparation business in which many of the fraudulent refund checks were sent to the business address. Alvarez and Ramirez received over $1,773 million worth of fraudulently obtained refund checks. Both are scheduled for sentencing May 1, 2020.
Marcus Alvarez pleaded guilty in June 2019 to Title 18, USC 641- Public Money, property or records. Alvarez owned a check cashing establishment, El Punto, and aided and abetted others in cashing over $54 million of fraudulent tax refund checks. Alvarez admitted that he knew that the people bringing the tax refund checks into the check cashing business were running a fraudulent tax refund scheme in which they obtained documents from Mexico, fraudulent applied for ITIN numbers in the names of Mexican citizens, and then filed fraudulent tax returns using those ITIN numbers. His sentencing is scheduled for May 6, 2020.
Marina Andino is currently awaiting sentencing after pleading guilty to Title 18, USC 641. Public Money, property or records in December 2018. Andino started a tax preparation business in which she primarily prepared tax returns for non-resident aliens who claim dependents who do not live in the United States. Andino admitted that she stole $255,716 from the federal government by knowingly preparing fraudulent tax returns for others and cashing the fraudulent tax refunds for her own use. Sentencing is scheduled for May 19, 2020.