The fraudsters have been active in the tax realm this week. We’ve got stories from across the country.
We’ll start in Youngstown, Ohio, where Ronald Wells had an idea of how to increase his $1/hour pay as a prisoner at the Trumbell County (Ohio) prison—he’d have friends file 35 phony tax returns with the IRS. This cost us taxpayers over $236,000 in refunds that the IRS paid out. Wells, no matter how long he’s sentenced for, won’t be going anywhere soon; he’s now serving a sentence for aggravated murder in the Grafton (Ohio) Correctional Institution.
Heading just east, from Pittsburgh comes the story of the family that’s accused of committing fraud together. James Lloyd is serving time at the Fayette County (Pennsylvania) Prison, his wife Elizabeth, and their daughter Naomi Malone are all accused of filing a false tax return, and getting $14,700. These first two stories are not the first time we’ve seen inmates accused of committing tax fraud.
Yet another Gentleman’s Club owner has found himself in trouble. Ronald Heidel, of Sanibel, Florida, will find himself at ClubFed for 18 months after underreporting income at his Gentleman’s Gold Club by $1.3 million. He also must make restitution of $130,000 and pay a $30,000 fine. I almost forgot to mention that Heidel is a former IRS agent.
The owners of a casino boat-to-nowhere will no longer be heading to sea but, instead, will be heading up the river to ClubFed. Samuel Gray and his wife Marilyn were each convicted on 18 counts of tax fraud and 4 counts of mail fraud. Samuel Gray was also found guilty of six counts of money laundering and receiving embezzled funds. We first wrote about this story in 2005 when the owner of a bank who was embezzling money managed to invest with another individual committing fraud. Samuel Gray faces a decade at ClubFed; his wife is looking at about 4 years.
Heading further south to Miami, we find a businessman who had an almost-perfect method to having his personal expenses paid by his business. David Traina set up a consulting firm. No problem with that. He was the only employee. That’s fine. He paid personal expenses out of his business and took deductions for them. That’s not good, and it’s worse when the IRS finds out. And when you avoid $70,000 in taxes, that’s a lot of veterinary bills. Mr. Traina has agreed to make restitution but may also find himself at ClubFed for a short stay.
We’ve written about the La Shish restaurants on two occasions. Elfat El Aouar received 18 months at ClubFed in her part of the tax fraud that cost the government $6.9 million in taxes. Her husband, Talal Chahine, is still a fugitive from justice and is believed to be in Lebanon. The IRS may end up owning the La Shish restaurants—liens have been filed to protect the government’s claims.
Heading to the Northwest, Laura Cook, the wife of convicted “tax guru” Wade Cook, pleaded guilty to obstruction of justice. Ms. Cook admitted that she created phony documents to evade $9.4 million in taxes. Under the plea agreement, the government will recommend 15 months at ClubFed.
That’s a lot of fraud, but somehow I figure to be able to bring up another list of cases next week.