FROM: U.S. JUSTICE DEPARTMENT
Wednesday, December 10, 2014
Utah Accountant Sentenced for Filing Over $9 Million in False Tax Refund Claims and $300 Million Fictitious Financial Instrument
A Heber City, Utah, man was sentenced today to serve 78 months in prison for filing false claims for income tax refunds and for filing a fictitious financial instrument, announced Acting Deputy Assistant Attorney General Larry J. Wszalek for the Department’s Tax Division and the Internal Revenue Service (IRS).
U.S. District Court Judge Clark Waddoups also ordered Dick Reid Jenkins, to pay $250,340 in restitution to the IRS and to serve three years of supervised released upon his release from prison.
In June 2014, Jenkins, a certified public accountant, was convicted at trial of 18 counts of filing false claims for tax refunds and one count of presenting a fictitious financial instrument to the United States. According to the superseding indictment and the proof at trial, in September 2008, Jenkins filed a false individual income tax return for himself for tax year 2007 which claimed an income tax refund of $402,920. Then, in October 2008, Jenkins filed a false amended 2004 individual income tax return, which claimed an income tax refund of $434,261. Both false claims were based on the use of a falsified IRS Form 1099-OID (Original Issue Discount), which is a form of accrued interest, to claim the false refunds. From 2009 through 2014, the IRS has listed this scheme as one of its “Dirty Dozen” worst tax scams.
According to both the superseding indictment and the proof at trial, in addition to his own false returns, from September 2008 through February 2009, Jenkins caused 16 other false federal individual income tax returns to be filed on behalf of other individuals. These false tax returns also used false Forms 1099-OID and claimed federal income tax refunds totaling $8,407,623.
Additionally, according to the superseding indictment and the proof at trial, on June 30, 2008, Jenkins presented a false and fictitious financial instrument to the U.S. Department of the Treasury in the amount of $300 million.
The case was investigated by special agents of IRS-Criminal Investigation. Trial Attorney Stuart Wexler for the Tax Division prosecuted the case.
Showing posts with label ACCOUNTANT. Show all posts
Showing posts with label ACCOUNTANT. Show all posts
Friday, December 12, 2014
Sunday, December 15, 2013
FORMER D.C. ACCOUNTANT RECEIVES PRISON SENTENCE FOR TAX FRAUD
FROM: U.S. JUSTICE DEPARTMENT
Wednesday, December 11, 2013
Former Washington, D.C.-Area Accountant Sentenced to Prison for Tax Fraud
The Justice Department and Internal Revenue Service (IRS) announced today that John T. Hoang, of Woodbridge, Va., was sentenced in federal district court in Washington, D.C., for willfully aiding and assisting in the preparation of false income tax returns for the 2004 tax year. U.S. District Judge Richard J. Leon sentenced Hoang to serve 48 months in prison, 24 months of supervised release and 240 hours of community service. Judge Leon also ordered him to pay $331,896 in restitution to the IRS. Hoang previously pled guilty on July 31, 2013.
According to court documents and statements made in court, Hoang was a certified public accountant (CPA) and an attorney. From January 2005 through April 2007, Hoang operated John T. Hoang CPA, a tax return preparation business,, and was one of two partners who owned Tax-Smart Technology Services. Hoang operated these businesses from various locations in Washington, D.C., and Fairfax, Va. In 2008, a federal district court in Virginia barred Hoang from preparing federal tax returns.
As alleged in court documents, in his capacity as a tax return preparer, Hoang prepared and supervised the preparation of client tax returns to be filed with the IRS and various state taxing authorities. For the tax years 2004, 2005 and 2006, Hoang prepared hundreds of U.S. Individual Income Tax Returns and earned substantial income from his tax preparation activities. Hoang further received a substantial portion of the refunds issued by the IRS to his clients through his businesses. Despite earning revenue through his businesses of approximately $1 million in 2004; $2 million in 2005; and $3 million in 2006, Hoang failed to file any federal income tax returns or pay any federal income taxes for himself or his businesses during this time.
Hoang admitted that he prepared and caused the preparation of false and fraudulent 2004, 2005 and 2006 income tax returns for his clients. When preparing these false tax returns and related schedules for his clients, Hoang created wholly fictitious business income and expenses for what seemed to be a technology licensing business. The false information resulted in the client-taxpayers reporting fake losses from business activity and receiving either refunds larger than those they were entitled or decreases in the amount of taxes due. Hoang admitted that the tax loss caused by certain false returns he prepared was greater than $30,000 per return, and that he prepared at least 24 such false returns for the 2004 through 2006 tax years.
As part of the plea agreement, Hoang admitted that the total tax loss caused by his criminal conduct is greater than $1.5 million.
The case was investigated by IRS-Criminal Investigation and was prosecuted by Trial Attorneys Jorge Almonte and Jeffrey B. Bender of the Justice Department’s Tax Division.
Wednesday, December 11, 2013
Former Washington, D.C.-Area Accountant Sentenced to Prison for Tax Fraud
The Justice Department and Internal Revenue Service (IRS) announced today that John T. Hoang, of Woodbridge, Va., was sentenced in federal district court in Washington, D.C., for willfully aiding and assisting in the preparation of false income tax returns for the 2004 tax year. U.S. District Judge Richard J. Leon sentenced Hoang to serve 48 months in prison, 24 months of supervised release and 240 hours of community service. Judge Leon also ordered him to pay $331,896 in restitution to the IRS. Hoang previously pled guilty on July 31, 2013.
According to court documents and statements made in court, Hoang was a certified public accountant (CPA) and an attorney. From January 2005 through April 2007, Hoang operated John T. Hoang CPA, a tax return preparation business,, and was one of two partners who owned Tax-Smart Technology Services. Hoang operated these businesses from various locations in Washington, D.C., and Fairfax, Va. In 2008, a federal district court in Virginia barred Hoang from preparing federal tax returns.
As alleged in court documents, in his capacity as a tax return preparer, Hoang prepared and supervised the preparation of client tax returns to be filed with the IRS and various state taxing authorities. For the tax years 2004, 2005 and 2006, Hoang prepared hundreds of U.S. Individual Income Tax Returns and earned substantial income from his tax preparation activities. Hoang further received a substantial portion of the refunds issued by the IRS to his clients through his businesses. Despite earning revenue through his businesses of approximately $1 million in 2004; $2 million in 2005; and $3 million in 2006, Hoang failed to file any federal income tax returns or pay any federal income taxes for himself or his businesses during this time.
Hoang admitted that he prepared and caused the preparation of false and fraudulent 2004, 2005 and 2006 income tax returns for his clients. When preparing these false tax returns and related schedules for his clients, Hoang created wholly fictitious business income and expenses for what seemed to be a technology licensing business. The false information resulted in the client-taxpayers reporting fake losses from business activity and receiving either refunds larger than those they were entitled or decreases in the amount of taxes due. Hoang admitted that the tax loss caused by certain false returns he prepared was greater than $30,000 per return, and that he prepared at least 24 such false returns for the 2004 through 2006 tax years.
As part of the plea agreement, Hoang admitted that the total tax loss caused by his criminal conduct is greater than $1.5 million.
The case was investigated by IRS-Criminal Investigation and was prosecuted by Trial Attorneys Jorge Almonte and Jeffrey B. Bender of the Justice Department’s Tax Division.
Saturday, September 28, 2013
BERNIE MADOFF'S ACCOUNTANT CHARGED BY SEC WITH CREATION OF FALSE BOOKS AND RECORDS
FROM: U.S. SECURITIES AND EXCHANGE COMMISSION
The Securities and Exchange Commission today charged the longtime accountant for many of Bernard Madoff’s oldest and wealthiest clients for his role in the creation of false books and records used in the massive Ponzi scheme.
The SEC alleges that Paul Konigsberg’s assistance resulted in the formation of inaccurate trade confirmations each month as well as the development of phony data and records documenting the fabricated trades that were, in turn, falsely reflected in the ledgers and related books and records at Bernard L. Madoff Investment Securities LLC (BMIS).
“Konigsberg played a vital role in Madoff’s deception of his oldest and wealthiest clients over many years,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office. “Konigsberg’s acquiescence, cooperation, and collaboration were essential to the Madoff fraud.”
In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Konigsberg.
According to the SEC’s complaint filed in U.S. District Court for the Southern District of New York, Konigsberg aided and abetted the falsification of books and records at BMIS from at least the mid-1990s to late 2008. Konigsberg provided tax or accounting services for more than 200 BMIS client accounts, including five of Madoff’s wealthiest and oldest clients who invested more than a billion dollars combined in BMIS. Konigsberg received fees directly from BMIS clients for the accounting services that he provided them, and BMIS and Madoff paid him a monthly fee of $15,000 or $20,000 as a “retainer” for providing accounting services to a wealthy and longtime Madoff client and his adult children.
The SEC alleges that Konigsberg coordinated with BMIS staff to:
Decide upon desired investment or tax gains and losses to be manufactured and reflected on BMIS account statements and in BMIS computer systems to ensure his clients enjoyed favorable tax treatment for their purported investment activity.
Confer about backdated trades and fictitious account activity entered into the computer systems to create the desired trading results.
Return or destroy his clients’ true BMIS account statements and design alternative fictitious account activity to be entered into the firm’s books and records and reflected on new phony account statements.
The SEC’s complaint alleges that Konigsberg, who lives in Greenwich, Conn., aided and abetted the BMIS violations of Section 17(a) of the Securities Exchange Act and Rule 17a-3, and Section 204 of the Investment Advisers Act and Rule 204-2. The SEC’s complaint seeks disgorgement of ill-gotten gains, financial penalties, and permanent injunctions against Konigsberg.
The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation. The SEC’s investigation is continuing.
The Securities and Exchange Commission today charged the longtime accountant for many of Bernard Madoff’s oldest and wealthiest clients for his role in the creation of false books and records used in the massive Ponzi scheme.
The SEC alleges that Paul Konigsberg’s assistance resulted in the formation of inaccurate trade confirmations each month as well as the development of phony data and records documenting the fabricated trades that were, in turn, falsely reflected in the ledgers and related books and records at Bernard L. Madoff Investment Securities LLC (BMIS).
“Konigsberg played a vital role in Madoff’s deception of his oldest and wealthiest clients over many years,” said Andrew M. Calamari, Director of the SEC’s New York Regional Office. “Konigsberg’s acquiescence, cooperation, and collaboration were essential to the Madoff fraud.”
In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Konigsberg.
According to the SEC’s complaint filed in U.S. District Court for the Southern District of New York, Konigsberg aided and abetted the falsification of books and records at BMIS from at least the mid-1990s to late 2008. Konigsberg provided tax or accounting services for more than 200 BMIS client accounts, including five of Madoff’s wealthiest and oldest clients who invested more than a billion dollars combined in BMIS. Konigsberg received fees directly from BMIS clients for the accounting services that he provided them, and BMIS and Madoff paid him a monthly fee of $15,000 or $20,000 as a “retainer” for providing accounting services to a wealthy and longtime Madoff client and his adult children.
The SEC alleges that Konigsberg coordinated with BMIS staff to:
Decide upon desired investment or tax gains and losses to be manufactured and reflected on BMIS account statements and in BMIS computer systems to ensure his clients enjoyed favorable tax treatment for their purported investment activity.
Confer about backdated trades and fictitious account activity entered into the computer systems to create the desired trading results.
Return or destroy his clients’ true BMIS account statements and design alternative fictitious account activity to be entered into the firm’s books and records and reflected on new phony account statements.
The SEC’s complaint alleges that Konigsberg, who lives in Greenwich, Conn., aided and abetted the BMIS violations of Section 17(a) of the Securities Exchange Act and Rule 17a-3, and Section 204 of the Investment Advisers Act and Rule 204-2. The SEC’s complaint seeks disgorgement of ill-gotten gains, financial penalties, and permanent injunctions against Konigsberg.
The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation. The SEC’s investigation is continuing.
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