Tax Refund Fraud

The Alleged Scheme: Bogus Tax Refund

In a significant legal development, a federal grand jury in Orlando has returned an indictment, recently unsealed, charging three individuals from Florida with serious crimes linked to their roles in an elaborate tax refund fraud scheme.

The allegations suggest that between 2015 and 2018, Christopher Johnson, a resident of Orlando, and Jasen Harvey from Tampa are among those indicted. They conspired to orchestrate a scheme where fraudulent income tax withholdings were reported to the IRS on behalf of clients, leading to undeserved tax refunds.

Fee-Driven Fraud

This unlawful endeavor allegedly included charging clients a fee per return, with Johnson reportedly failing to report his share of these fees on his personal tax returns.

Defying Court Orders

The indictment also asserts that in January 2020, a federal judge issued an injunction against Harvey, prohibiting him from preparing tax returns for others. Despite the court’s orders, Harvey is accused of continuing to prepare and submit tax returns from 2020 to 2021.

A Network of Deceit: Arthur Grimes

Furthermore, the indictment implicates Arthur Grimes, a resident of Orlando and Ocoee, Florida, who allegedly participated in the scheme. Grimes is alleged to have caused the filing of four false income tax returns, all prepared by Harvey.

Obstructing the IRS

When the IRS initiated efforts to recover a refund issued based on one of these false returns, Grimes purportedly engaged in a range of obstructive actions, including making false statements to an IRS revenue officer, submitting fraudulent documents to the IRS, transferring funds to a nominee bank account, and other activities aimed at hindering IRS collection efforts.

Facing the Charges

The charges against the individuals are as follows:

  • Aiding in the Preparation of False Tax Returns: This charge carries a maximum statutory penalty of three years in prison, and all three defendants, Johnson, Harvey, and Grimes, face this allegation.
  • Conspiracy to Defraud the United States: This offense carries a maximum statutory penalty of five years in prison, with Johnson and Harvey both charged with this crime.
  • Filing False Personal Tax Returns: Johnson is individually charged with this crime, which carries a maximum statutory penalty of three years in prison.
  • Criminal Contempt: Harvey faces this charge, which carries a maximum statutory penalty of life in prison.
  • Corruptly Endeavoring to Obstruct the Due Administration of the Internal Revenue Laws: Grimes is charged with this offense, which carries a maximum statutory penalty of three years.

Legal Proceedings Ahead

A federal district court judge will ultimately determine the sentences for the accused individuals after considering various factors, including the U.S. Sentencing Guidelines and other relevant statutory considerations.

Official Announcement

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, alongside U.S. Attorney Roger B. Handberg for the Middle District of Florida, jointly announced these charges. IRS-Criminal Investigation is actively conducting the investigation into this complex case.

Presumption of Innocence

It’s important to note that an indictment represents an allegation, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law. This case highlights the government’s commitment to combating tax fraud and ensuring the integrity of the tax system.

Tax Refund Fraud