Tax fraud Feed

Photo by RODNAE Productions Welcome to the continuation of the ol' blog's Tax Crime Weekend! Yesterday's post featured efforts to end abusive tax schemes and bring their promoters to justice. Today's post expands on the legal reckoning theme. The Internal Revenue Service's Criminal Investigation division, known as IRS-CI, recently revealed its top 10 cases of 2022. Wide variety of schemes, one outcome: The tax evasion attempts included Ponzi pyramid schemes, fake businesses, COVID-19 fraud, bogus tax credit, and even a reality TV couple. And more. Despite the diversity of their criminal tax acts, they shared one thing. They got caught.... Read more →


Photo by Nataliya Vaitkevich One of the reasons to file early is to beat tax identity thieves to the punch. Even though the Internal Revenue Service has slowed such tax crimes a bit in recent years, they're still out there. In fact, I've been getting a lot of scam span in recent weeks, both texts and email, like the one below I got this morning. While this poorly faked attempt — a Gmail address for the U.S. Agency for International Development's grant office; really? — isn't a specific tax hack attempt, some of the information the crooks want from me... Read more →


Nothing ever disappears on the internet. Even, or especially, tax related posts. Take the bad legal take on taxes that tops this post. It was retweeted on Sunday (Dec. 11) by, you guessed it, Bad Legal Takes. But there's no indication of when Dave Champion originally blasted out his bad tax advice. It might have been before he was barred by a federal court in 2012 from promoting a tax fraud scheme. Or maybe he's back, since this Tweet apparently went up in October. His books also are still for sale online. Either way, that item this weekend spurred a... Read more →


Not all foreign tax havens are tropical islands, but the idyllic getaways do conjure images of tax crooks enjoying isolated beaches at Internal Revenue Service's expense. (Photo by Asad Photo Maldives) Correlation does not imply causation, but in a couple of high-profile offshore tax evasion cases, it's starting to look like trying to allegedly put one over on the U.S. tax collector is not a healthy move. For the second time in four months, a defendant in an offshore tax evasion case has died. Carlos Kepke, a Houston-based tax attorney who was indicted on charges that he helped hide $225... Read more →


Some of my grandmother's paintings, known as the main Vera Gallery in our house. (Photo by Kay Bell) The hubby and I are art fans, primarily of painted works. That's why almost all of our vacations include a visit to our destinations' museums. Our appreciation of a piece hanging on a wall is why most of our rooms are adorned by framed artworks. Most are signed limited edition print versions of our favorite painters' works. But we also have some originals of a few notable artists, as well as works that are more sentimental but just as lovely, like the... Read more →


Right now, a lot of folks are thinking they should have been like Larry. The Larry they wished they'd emulated is Larry David, known for his curmudgeonly television character. He tweaked that persona to become a naysayer on several inventions that, per the commercial's Super Bowl debut, changed the world. The television ad for FTX crypto exchange advised viewers, "Don't be like Larry" and instead invest in digital currency via the company. On Friday, Nov. 11, FTX filed for bankruptcy following reports that between $1 billion to $2 billion of FTX customer funds disappeared. Continuing crypto troubles: This is just... Read more →


The Internal Revenue Service's Criminal Investigation (IRS-CI) division is doing its part to close the Tax Gap, which now sits at $496 billion in uncollected tax. The IRS' law enforcement group's recently released annual report notes that its agents initiated more than 2,550 criminal investigations, identified more than $31 billion from tax and financial crimes, and obtained a 90.6 percent conviction rate on cases that were prosecuted. Much of IRS-CI's success during the 2022 fiscal year, which ended on Sept. 30, was due to its increased cooperation and partnership with its global counterparts to combat tax and financial crimes worldwide.... Read more →


The Internal Revenue Service saw its largest tax fraud case ever end on Aug. 5 when Robert T. Brockman died. The 81-year-old billionaire had been charged with 39 criminal financial crimes, including tax evasion. Federal investigations alleged that Brockman was part of an elaborate offshore tax fraud scheme that cheated the U.S. Treasury out of more than $1.4 billion in taxes, penalties, and interest. While the criminal case is over, legal actions in civil and tax courtrooms to recoup the allegedly unpaid taxes (and add-on charges) continue. Special tax action to protect collection: As part of that process, the IRS... Read more →


We depend on our smartphones more than ever. They've made texting, especially among younger device owners, the preferred way to communicate. Crooks know this, too. Including tax identity thieves. The Internal Revenue Service says it's seen a recent rash of tax-related texting scams. These latest schemes, known as smishing because they use SMS (short message service) or MMS (multimedia messaging service), look like they are coming from the IRS. Don't fall for these fake IRS texts, which the tax agency says have increased exponentially this year. Exponential fake tax texts: So far in 2022, the IRS has identified and reported... Read more →


Just more than a year ago, a Parkville, Missouri, man pleaded guilty to charges filed in two separate federal investigations. One was a case involving conspiracy to commit wire and major program fraud. The defendant admitted to his role in a $335 million scheme to defraud federal programs that award contracts to firms owned by minorities, veterans, and service-disabled veterans. The second charge was one of tax evasion to the tune of $615,847. The Missouri man confessed to claiming fraudulent business expenses on his 2016 tax year return and filing false returns from 2013 to 2016. Last Thursday, Sept. 22,... Read more →


Aaron Paul, as Jesse Pinkman (right), explaining legal representation needs to soon-to-be meth king Walter White, played by Bryan Cranston, in a scene from AMC's "Breaking Bad." As much as I loved that show and its "Better Call Saul" sequel, don't take Jesse's legal advice when it comes to tax troubles. Get honest and experienced professional help for any potentially criminal tax charges, like the ones noted below. Maybe it's because I'm still processing the end "Better Call Saul," the wonderful six-season exploration of television's best show about the evolution of, echoing the emphasis of Breaking Bad's Jesse Pinkman, a... Read more →


UPDATE, Jan. 11, 2023: Computer incidents made today a bad day to fly in the United States and Canada, or try to send international mail in the United Kingdom. But those crashes make it a good day to double check your personal and business cyber security plans. The IRS has some tips and guidance for tax professionals' data reliability and protection. The Internal Revenue Service relies on taxpayers and tax professionals to help ensure that our national tax system is secure. These efforts are particularly critical as the federal tax agency goes more electronic. It's also a legal requirement for... Read more →


Robert J. Brockman speaking at the dedication of Centre College's Young Hall on in October 2011. (YouTube screenshot) The Texas billionaire charged in what Internal Revenue Service investigators called the largest U.S. tax fraud case ever died late Aug. 5 at his Houston home. The 81-year-old Robert J. Brockman suffered from Parkinson’s disease and dementia. In May, a federal judge deemed the former CEO of Reynolds & Reynolds, a software company for auto dealerships, was competent to face charges that he evaded taxes on $2 billion of income. A February 2023 trial date was set. So what happens now to... Read more →


One of the most common tax scam practices is to take a bit of truth and twist it. Con artists tweak tax forms, create fraudulent online presences that mimic real tax sites, and impersonate tax officials. The latest report of criminals honing their nefarious tax techniques involves the IRS' Tax Exempt and Governmental Entities (TEGE) division and tax-exempt bonds. As part of the way the IRS audits tax-exempt bonds, the agency's TEGE unit uses its own secure electronic messaging service to transmit and receive data. That communication system now is being used as a hook in a new phishing scheme.... Read more →


Photo by EKATERINA BOLOVTSOVA Dealing with the normal ups and, too frequently of late, downs of the stock market is enough of a worry. But things can quickly go even further downhill when crooks use fake investments to defraud victims. Not surprisingly, those criminals often get greedier and try to cheat Uncle Sam, too. Such overreach, however, didn't work out well for one California man. Robert Louis Cirillo of Chino Hills pleaded guilty in federal court on Tuesday, June 28, to charges of defrauding investors of $3.2 million, as well as scamming an elderly man of hundreds of thousands of... Read more →


The Internal Revenue Service's Whistleblower Office marked its 15th anniversary in fiscal year 2021 by making 179 awards to whistleblowers totaling more than $36 million. "Whistleblower claim numbers assigned in FY 2021 grew by 55% year over year, the second highest level of new claim numbers in the history of the program and claim closures also increased by 13%," wrote John Hinman, director of the IRS Whistleblower Office, in the introduction to the office's 2021 Annual Report to Congress, released on June 10. Those tips led to the IRS collecting in fiscal 2021 more than $245 million, which includes almost... Read more →


All graphics courtesy IRS Tax Pros Twitter account Benjamin Franklin wasn't quite correct. There are three constants in life: death, taxes, and tax scams. For more than two decades, the Internal Revenue Service has annually highlighted the 12 worst recent scams. This year's Dirty Dozen includes questionable tax arrangement touted by con artists, pandemic-related schemes to steal people's identities and refund money, dubious tax payment options, and unscrupulous tax preparers. For the last few years, the IRS has shifted from a single list of a dozen tax scams to multiple alerts with more details on the various scams. Those new... Read more →


Update, Monday, Aug. 8, 2022: Robert J. Brockman died at his Houston, Texas, home on Aug. 5, 2022. That effectively ends federal prosecutors' criminal tax evasion case against Brockman. Civil tax litigation, however, will continue against his estate. Shutterstock The billionaire charged in the largest U.S. tax fraud case ever is one step closer to facing trial. Robert J. Brockman, the former CEO of Reynolds & Reynolds, a software company for auto dealerships, was indicted on Oct. 1, 2020, on 39 counts of evading taxes on $2 billion of income. The 20-year scheme, according to the Internal Revenue Service Criminal... Read more →


House Oversight Committee members also investigating ID.me contracts, verification methods Photo by cottonbro In early February, the Internal Revenue Service announced plans to transition from ID.me's facial scanning identity verification system. The third-party service's scanning technology raised privacy concerns. A few weeks later, the IRS elaborated on its taxpayer identity process. It said the facial recognition would remain, but as an option, not a requirement. Taxpayers instead could participate in a live, virtual interview to prove they are legitimately opening their own online taxpayer account. The IRS also indicated that it eventually would join other federal agencies in using Login.Gov,... Read more →


New phishing scam targets tax pros, but everyone needs to be on guard The Internal Revenue Service today warned tax professionals about a new spearphishing scam. I'm surprised we made it into February before the latest tax scam appeared. This email scam uses the IRS logo. It also tries to ramp up the already urgent tax season by using a variety of subject lines, such as "Action Required: Your account has now been put on hold." The IRS provided bogus text of this scam below. Your account has now been put on hold ALL preparers are required to apply security... Read more →