Marcos Daniel Jiménez, United States Attorney for the Southern District of Florida, and Scott Rebein, Acting Special Agent in Charge of the Internal Revenue Service (IRS), Criminal Investigation Division, Miami Field Office, announced today that on January 28, 2004, 14 individuals were charged in 8 Indictments with conspiracy to present fraudulent tax returns to the IRS, presenting fraudulent tax returns to the IRS, and/or preparing and assisting in the preparation and presentation of fraudulent tax returns to the IRS. Additionally, 8 other individuals charged in 3 Indictments with various tax fraud offenses have agreed to plead guilty, have pleaded guilty, and/or have been sentenced.

As alleged in these 11 Indictments, the fraudulent schemes orchestrated by these defendants typically involved the recruitment of taxpayers with promises of larger refunds. The defendants prepared and filed, or were involved in the preparation and filing, with the IRS income tax returns on behalf of taxpayers which falsely represented, among other things, the income of these taxpayers, the employment of these taxpayers, the taxpayers’ tax withholdings, the taxpayers’ dependents, the taxpayers’ filing status, and/or the taxpayers’ allowable deductions. All done in order to fraudulently cause the IRS to issue much larger than warranted income tax refunds. More often than not, the taxpayers were unaware of the fraudulent nature of the income tax returns which these defendants were preparing and filing with the IRS on their behalf, and would usually receive only a portion of the refunds paid by the IRS. The tax fraud schemes perpetrated by these defendants involved the filing with the IRS of over 1700 fraudulent income tax returns during the course of several years which ultimately resulted in fraudulent income tax refund claims totaling over $4,108,000.

INDICTMENTS BY THE UNITED STATES ATTORNEY’S OFFICE

1. U.S. v. Joseph E. Dye
Case No. 04-20034-Cr-KING

On January 20, 2004, a federal grand jury returned an Indictment charging Joseph E. Dye with one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286, eight counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287, and one count of tampering with a witness, in violation of 18 U.S.C. § 1512. The defendant orchestrated a fraudulent scheme during tax season of year 2000 whereby he recruited several individuals and prepared and filed on their behalf approximately 25 fraudulent income tax returns which resulted in fraudulent tax refund claims of over $70,000. The Indictment also alleges that during the course of the IRS’ investigation into this matter, the defendant threatened a witness with physical harm if the witness assisted federal agents with their investigation. If convicted, the maximum statutory term of imprisonment is 10 years as to the conspiracy count, 5 years as to each of the fraudulent claims counts, and 10 years as to the witness tampering count.

2. U.S. v. Maritza Valiente, Eda Felix, Esther Rivera, and Ela Melendez
Case No. 04-20046-Cr-Ungaro-Benages

On January 22, 2004, a federal grand jury returned an Indictment charging Maritza Valiente with two counts of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286, and nine counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. 287. Eda Felix is charged with one count of conspiracy to make and present fraudulent claims against the United States and eight counts of making and presenting fraudulent claims against the United States. Esther Rivera is charged with two counts of conspiracy to make and present fraudulent claims against the United States and six counts of making and presenting fraudulent claims against the United States. Ela Melendez is charged with one count of conspiracy to make and present fraudulent claims against the United States and four counts of making and presenting fraudulent claims against the United States. The Indictment charges that the defendants orchestrated a fraudulent scheme whereby they recruited numerous individuals and prepared and filed on their behalf approximately 12 fraudulent income tax returns which resulted in fraudulent tax refund claims of over $54,000.

According to the Indictment, in 2000 the defendants prepared and filed income tax returns which falsely claimed employment income from United Mortgage Financing, a company owned by Valiente. Although United never engaged in any business activity and had no employees, the defendants authored tax returns on behalf of dozens of individual taxpayers seeking refunds based upon significant income from United. The Indictment alleges that Felix, operating as First Services Corporation in Hialeah, Florida, prepared and filed some of these fraudulent returns, while Melendez, operating as Alexia Insurance, Tax Services & Check Cashing, Inc., in Miami, Florida, prepared others. The Indictment also alleges that Rivera, a First Services employee, assisted the defendants in preparing the fraudulent returns. The Indictment further alleges that, besides falsely claiming income from United, returns prepared and filed by the defendants also claimed inflated refunds based upon false information about the taxpayers’ dependents. If convicted, the maximum statutory term of imprisonment is 10 years as to each of the conspiracy counts, and 5 years as to each of the fraudulent claims counts.

3. U.S. v. Willie James Collins and Patricia Ann Sapp
Case No. 04-60014-Cr-Marra

On January 27, 2004, a federal grand jury returned an Indictment charging Willie James Collins and Patricia Ann Sapp with one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286, and twenty-six counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. The Indictment charges that the defendants orchestrated a fraudulent scheme from February 2000 to April 2002, with respect to tax years 1999, 2000 and 2001, whereby they recruited numerous individuals and prepared and filed on their behalf approximately 78 fraudulent income tax returns which resulted in fraudulent tax refund claims of over $302,000.

The Indictment alleges that Collins and Sapp recruited taxpayers and prepared fraudulent IRS W-2 forms on their behalf. They then directed the taxpayers to use the fraudulent IRS W-2 forms in the filing of their income tax returns with the IRS. The fraudulent W-2 forms reflected income that the taxpayers had not earned in order to increase the taxpayers’ earned income tax credit. Collins and Sapp caused the preparation of fraudulent federal income tax returns on the taxpayers’ behalf, falsely claiming that these taxpayers were entitled to tax refunds based upon their alleged employment and purported income during the years 1999, 2000 and 2001, when they knew that these taxpayers had not been employed as described in the tax returns and had not earned the income that was reported in the returns. The Indictment also alleges that Collins and Sapp filed fraudulent claims with the IRS, specifically, false individual income tax returns and supporting documents such as IRS Forms 1040, 1040EZ, 8453 and W-2, claiming tax refunds on behalf of individual taxpayers knowing such claims were fraudulent, in that the tax returns reported income that the individual taxpayers had not earned. If convicted, the maximum statutory term of imprisonment is 10 years as to the conspiracy count, and 5 years as to each of the fraudulent claims counts.

4. U.S. v. Joanne Beneby
Case No. 04-20051-Cr-Martinez

On January 27, 2004, a federal grand jury returned an Indictment charging Joanne Beneby with sixteen counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. The Indictment alleges that Beneby prepared and caused to be submitted to the IRS income tax returns claiming tax refunds on behalf of herself and four different taxpayers, knowing that these returns reported fabricated dependents and filing status. According to the Indictment, Beneby prepared and filed these fraudulent returns during years 1999 through 2002, and resulted in fraudulent tax refund claims of over $92,000. If convicted, the maximum statutory term of imprisonment is 5 years as to each of the fraudulent claims counts.

5. U.S. v. Ana Laitano
Case No. 04-20053-Cr-GOLD

On January 28, 2004, an Information was filed charging Ana A. Laitano with two counts of assisting and advising in the preparation and presentation of fraudulent income tax returns to the IRS, in violation of 26 U.S.C. § 7206(2). The Information alleges that Laitano prepared and caused to be submitted United States Individual Tax Returns claiming tax refunds on behalf of several taxpayers, knowing that these returns contained materially false information. Specifically, Laitano would claim Head of Household filing status for these taxpayers when, in fact, they did not qualify for such filing status. The Information alleges that Laitano prepared and filed these returns between 1999 and 2000. Laitano’s tax fraud scheme resulted in fraudulent tax refund claims of over $93,000. If convicted, the maximum statutory term of imprisonment is 3 years as to each of the preparation and presentation of fraudulent income tax return counts.

6. U.S. v. Richard Casseus and Shretta Renee Casseus
Case No. 04-20047-Cr-MARTINEZ

On January 22, 2004, a federal grand jury returned an Indictment charging Richard Casseus and Shretta Casseus with one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286, and seven counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. The Indictment charges that the defendants orchestrated a fraudulent scheme from February 2000 to April 2001, with respect to tax years 1999 and 2000, whereby they recruited numerous individuals and prepared and filed on their behalf fraudulent income tax returns which resulted in fraudulent tax refund claims of over $88,000.

As alleged in the Indictment, over a two-year period, Richard and Shretta Casseus recruited taxpayers and caused the preparation of materially false, fictitious, and fraudulent federal income tax returns on these taxpayers’ behalf, claiming that these taxpayers were entitled to tax refunds based upon their employment and purported income during the years 1999 and 2000. The income reported by the Casseuses for these taxpayers included amounts for tips when the defendants knew the taxpayers had not earned tips in the amounts as described in the tax returns and thus had not earned the income that was reported in the returns. The Casseuses altered IRS Forms 1040, 8453 and W-2, by including the fictitious tips in the reported income to the IRS. If convicted, the maximum statutory term of imprisonment is 10 years as to the conspiracy count, and 5 years as to each of the fraudulent claims counts.

7. U.S. v. Freddie Lee Howard
Case No. 04-20045-Cr-Middlebrooks

On January 22, 2004, a federal grand jury returned an Indictment charging Freddie Lee Howard with twenty-two counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. The Indictment alleges that Howard prepared and caused to be submitted income tax returns to the IRS claiming tax refunds on behalf of 22 taxpayers, knowing that these returns reported income which the individual taxpayers had not earned. According to the Indictment, Howard prepared and filed these returns during 1999 and 2000, and resulted in fraudulent tax refund claims of over $99,000. If convicted, the maximum statutory term of imprisonment is 5 years as to each of the fraudulent claims counts.

8. U.S. v. Lauda Mojica
Case No. 04-20058-Cr-MORENO

On January 27, 2004, a federal grand jury returned an Indictment charging Lauda Mojica with eight counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. The Indictment alleges that Mojica prepared and caused to be submitted fraudulent income tax returns to the IRS claiming tax refunds on behalf of various taxpayers, knowing that these returns reported false deductions. Mojica prepared and filed these returns during years 1999 through 2000. Overall, Mojica’s fraudulent scheme involved the filing of numerous fraudulent tax returns which ultimately resulted in fraudulent tax refund claims of as much as $1,500,000. If convicted, the maximum statutory term of imprisonment is 5 years as to each of the fraudulent claims counts.

9. U.S. v. Shanobra L. Howard, Patricia Y. Streeter, and Reene A. Dillard
Case No. 03-20624-Cr-Moreno

On January 22, 2004, Shanobra L. Howard, Patricia Y. Streeter, and Reene A. Dillard pleaded guilty to one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286. On July 31, 2003, a federal grand jury returned an Indictment charging Howard, Streeter, and Dillard with one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286, and thirteen counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. The charges arose from a fraudulent scheme spanning years 1999 and 2000 where the defendants recruited taxpayers and prepared fraudulent income tax returns on their behalf, claiming that these taxpayers were entitled to tax refunds based upon their employment and purported income during years 1998 and 1999, when the defendants knew that these taxpayers had not been employed as represented in the tax returns and had not earned the income that was reported in said returns. The defendants’ fraudulent scheme involved the filing of numerous fraudulent tax returns which ultimately resulted in fraudulent tax refund claims of over $182,000. The defendants are scheduled to be sentenced on March 31, 2004, and face a maximum statutory term of imprisonment of 10 years.

10. U.S. v. Deloris McCray
Case No. 03-80052-Cr-Hurley

Deloris McCray has agreed to plead guilty in this matter and a hearing for her guilty plea has been scheduled for February 13, 2004. McCray was charged in an Indictment with ten counts of assisting and advising in the preparation and presentation to the IRS of fraudulent income tax returns, in violation of 26 U.S.C. § 7206(2). The Indictment alleges that McCray assisted in the preparation and presentation to the IRS of income tax returns claiming tax refunds on behalf of several taxpayers, knowing that these returns contained materially false information. Specifically, McCray would include false information regarding employer, income, and tax withholdings for these taxpayers. As alleged in the Indictment, McCray prepared and filed these fraudulent returns for tax years 1997, 1998, and 1999. McCray’s tax fraud scheme resulted in fraudulent tax refund claims of over $230,000. If convicted, the maximum statutory term of imprisonment is 3 years as to each of the preparation and presentation of fraudulent income tax return counts.

11. U.S. v. Felix Araujo, Yenny Mercedes, Marina Nolasco, Cesar Gomez, and Claribel Sarmiento
Case No. 02-20034-Cr-Lenard

On January 23, 2004, Cesar Gomez was sentenced to 9 months of imprisonment, two years of supervised release, and was ordered to pay $40,211.21 in restitution after he pleaded guilty to one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286. On January 12, 2004, Yenny Mercedes, Marina Nolasco, and Claribel Sarmiento were sentenced after having pleaded guilty earlier. Yenny Mercedes was sentenced to 21 months of imprisonment, three years of supervised release, and was ordered to pay $778,703.01 in restitution. Marina Nolasco was sentenced to 15 months of imprisonment, three years of supervised release, and was ordered to pay $778,703.01 in restitution. Claribel Sarmiento was sentenced to three years of probation with a special condition of 180 days of home confinement. Felix Araujo remains a fugitive.

The defendants were charged in an Indictment with one count of conspiracy to make and present fraudulent claims against the United States, in violation of 18 U.S.C. § 286, and/or ten counts of making and presenting fraudulent claims against the United States, in violation of 18 U.S.C. § 287. As alleged in the Indictment, the defendants participated in a scheme pursuant to which they defrauded the IRS by submitting as many as 800 false and fictitious income tax returns over a three-year period, years 1995 through 1998. Araujo was the owner of U.S. International Trading, Inc., a company which provided services ranging from selling beepers to assisting people with their immigration paperwork and preparing tax returns. As alleged in the Indictment, Araujo targeted unsophisticated individuals who came to his business and prepared tax returns using individuals’ information without their knowledge. When the tax returns were prepared, Araujo would use the addresses of his friends and his employees, including Mercedes, Nolasco, Gomez, and Sarmiento as the return addresses causing refund checks to be mailed to those addresses. Araujo would collect the checks, have them falsely endorsed and cashed. The taxpayer would therefore be completely unaware that any returns had been filed on her/his behalf. The defendants’ fraudulent scheme resulted in fraudulent tax refund claims of over $1,234,000.

Mr. Jiménez stated, “The integrity of the tax revenue system is of paramount importance to this Office and the IRS. We will aggressively prosecute those who defraud the United States Treasury and the American taxpayers in order to illegally enrich themselves.”

Mr. Jiménez commended the investigative efforts of the Internal Revenue Service, Criminal Investigation. These cases are being prosecuted by Assistant United States Attorneys Richard Boscovich, Ricardo Del Toro, Lois Foster-Steers, Lothrop Morris, Jennifer Lovemore, Rosa Rodriguez-Mera, and John Shipley.