13 Sep Newsletter September 13, 2018
September 13th, 2018
Inside this edition:
- The IRS Breaks Up Phone Scam Ring That Stole Hundreds of Millions of Dollars
- Presidential Tax Facts
- A Bit of Humor
- Virginia Couple Tries to Outsmart the IRS and Gets Caught
- Question & Answer
- For the Foodies … Chocolate Avocado Cookies
The IRS Breaks Up Phone Scam Ring That Stole Hundreds of Millions of Dollars
After years of investigative work by the Justice Department and other governmental agencies, 21 individuals were sentenced in July 2018 for defrauding over 15,000 victims from 2012 to 2016 in an elaborate phone scam operation. Indictments were also issued to 32 conspirators located in India.
The scam worked like this: A person posing as an IRS or immigration official would phone the victim through call centers in India and would threaten them with arrest, deportation or other penalties if the victims did not pay their “debts” immediately with prepaid cards or wire transfers. The call centers would then turn the information over to a network of “runners” based in the US who used the cards to purchase money orders that were then deposited to a bank account.
Examples of victims include an 85- year old woman in San Diego paid $12,300 to people claiming to be IRS employees who threatened her with arrest for tax violations, and a New Hampshire woman was told to pay the IRS $3,980 in debit cards as the caller ID showed up as “U.S. Government.”
The longest prison sentences include three men; Miteshkumar Patel of IL, who received a sentence of 20 years in prison, Hardik Patel also of IL, was given 15 years and Sunny Joshi of TX was sentenced to 12 years in prison. 22 of the defendants were also ordered to pay the victims restitution of $8.9 million and judgments of over $72 .9 million.
The defendants from India have not been arraigned yet.
Presidential Tax Facts
- Our modern day federal income tax system was created by the Revenue Act of 1913, which was signed into law by President Woodrow Wilson on October 3, 1913.
- Social Security numbers were first issued by the Social Security Administration in 1935. The numbers were created to help administer Franklin Roosevelt’s New Deal Social Security Program, officially called the Social Security Act.
- President Ronald Reagan paid tax in 1981 at an effective rate of 40%, the highest paid by any president.
- President Richard Nixon’s infamous “I am not a crook” comment wasn’t directed at Watergate; he was referring to allegations that he had not paid his taxes.
A Bit of Humor…
“When it comes to taxes, there are two types of people. There are those that get it done early, also know as psychopaths, and the rest of us.”
– Jimmy Kimmel
Virginia Couple Tries to Outsmart the IRS
and Gets Caught
Barry and Joan Edwards, from Concord, VA, who were convicted on one count of filing a fraudulent tax return, and one count of conspiring to structure cash transactions, were sentenced to prison time.
Joanne Edwards was previously sentenced in May 2018 and received a sentence of 18 months in prison and three years supervised release. Barry Edwards was sentenced to 36 months in prison and ordered to pay $7,929 in restitution to the IRS for unpaid taxes.
It was shown in court that the Edwards created two false religious missions in 2006, which they used as nominees to receive income from nutritional supplement sales. The earnings were deposited into bank accounts held in the nominee’s name. The couple withdrew more than $475,000 in increments of less than $10,000 to evade bank-reporting requirements. The Edwards used the funds to pay personal expenses such as car payments, tuition and paid cash for a five-acre farm. They also filed fraudulent tax returns from 2013 to 2015 in which they did not fully report their income.
While the government was investigating her false claim on her returns from Tuition Assistance, receiving $4,000 for tuition reimbursement for classes she did not take, Aleykina lied to the agents requesting her laptop by claiming she did not know where it was but began deleting files from the computer after the agents left.
It’s estimated that the loss to the IRS is more than $60,000. Sentencing will be in September 2018 where she could face three years in prison for each count of filing a false return, 10 years in prison for theft of government funds, 20 years for obstruction of justice.
I’d like to hear from you…
If you have an IRS issue, or just want to refer a friend, relative or client, I’d love to hear from you. I can provide a no-obligation, confidential consultation to help you solve your IRS problems.
Thank you for your kind words
Jeff and his staff have helped our family through our tax troubles in the past. And I know he’ll continue in the future.
– Don Musante
Q & A
For the foodies…
Chocolate Avocado Cookies
I hope you enjoy this recipe.