IRS Tackles Tax Fraud and Related Crimes

“The IRS Criminal Investigation takes violations of tax law very seriously,” said Leslie P. DeMarco, Special Agent in Charge of the IRS Criminal Investigation, Los Angeles Field Office. “Tax Return Preparers and individuals who choose to prepare and file false tax returns, steal refund payments, misuse client’s identity, or in any other manner undermine the honesty and integrity of our tax system risk prosecution.”

In the greater Southern California area, IRS Criminal Investigation special agents are actively investigating those involved in alleged criminal violations of involving alleged return preparer fraud, questionable refund fraud, and identity theft. United States District Court records for the Central District of California reveal the following legal actions this week:

Costa Mesa Tax Preparer Indicted for Aiding and Assisting In the Preparation of False Tax Returns

Ronald Vernon Strawn, 67, of Costa Mesa was arrested in Prescott, Arizona.

On April 11, 2012, in Santa Ana, a federal grand issued a 50-count indictment charging Ronald Strawn, 67, with preparing and filing false Federal Income Tax Return Forms 1040 in the Central District of California.

The indictment alleges that Strawn prepared tax returns claiming false Schedule E (used to report losses from rental real estate, royalties, partnerships, S corporations, estates, trusts, REMICs) losses or false Schedule C (used to report profit or loss from a sole proprietorship business) losses.

According to the indictment, Strawn knew that the taxpayer for whom the tax returns were prepared were not entitled to the fictitious business losses he claimed on Schedule E and Schedule C.

Strawn is alleged to have claimed over $6.5 Million in false business losses on at least 50 tax returns.

Strawn previously pleaded guilty to one misdemeanor count of filing a false tax return in violation of 26 U.S.C. § 7207 in the United States District Court for the District of Arizona on December 16, 2008.

Each count of preparing and filing a false Federal Income Tax Return carries a maximum penalty of three years in prison, one year of supervised release, and a $100,000 maximum fine. Strawn faces a total maximum penalty of 150 years imprisonment and a fine of up to $5,000,000.

The investigation of Ronald Vernon Strawn is being conducted by IRS Criminal Investigation and is being prosecuted by Assistant United States Attorney Todd T. Tristan of the U.S. Attorney’s Office for the Central District of California. Assistant United States Attorney Todd T. Tristan may be reached at (714) 338-2829

Apple Valley Women Indicted for Tax Fraud and ID Theft

Lynda McNeal, 57, of Apple Valley was arrested in Phoenix, Arizona.

On April 6, 2012, a federal grand jury in Los Angeles issued two separate indictments charging, Lynda McNeal and Ayeesha Stallworth, both from Apple Valley, with multiple counts of making false claims against the United States by filing federal tax returns that claimed false tax refunds. McNeal was also charged with identity theft.

McNeal is charged with filing seven false tax returns for others, each claiming a refund of between $15,846 and $31,968. Two of these returns were for individuals whose identities she stole. McNeal also filed two false returns for herself, for 2007 and 2008, each claiming over $30,000 in false refunds. Altogether, these nine returns claimed over $140,000 in false refunds.

Similarly, Ayesha Stallworth, 40, is charged with filing four false tax returns for others and one for herself, claiming a total of nearly $70,000 in false refunds.

Each tax count of making false claims against the United States carries a maximum penalty of five years in prison, one year of supervised release, and a $250,000 maximum fine. Each identity theft count carries a maximum penalty of five years in prison, three years of supervised release, and a $250,000 fine. McNeal faces a total maximum penalty of 40 years imprisonment and a fine of up to $2,500,000. Stallworth faces a total maximum penalty of 25 years imprisonment and a fine of up to $1,250,000.

The next court appearance scheduled for Lynda McNeal is today, April 18, 2012 in Riverside before U.S. Magistrate Judge Oswald Parada.

The investigation of Ayeessa Stallworth and Linda McNeal is being conducted by IRS – Criminal Investigation and is being prosecuted by Trial Attorney Ignacio Perez de la Cruz for the U.S. Justice Department’s Tax Division and by Assistant United States Attorney Jerry Yang of the U.S. Attorney’s Office Central District of California. Assistant United States Attorney Jerry Yang may be reached at (951) 276-6221.

An Indictment and Information only contain allegations that a defendant has committed a crime. Each defendant is presumed to be innocent unless and until proven guilty in court.

The IRS encourages taxpayers to visit the IRS website for the latest updates on tax schemes and scams and what to avoid. The IRS website at http://www.irs.gov provides various tips in what to look for – and what to look out for – when choosing a tax professionals and tips for protecting your identity.

If you suspect tax fraud or know of an abusive return preparer, you can report the subject directly to IRS – Criminal Investigation in person at one our local offices or over the phone. In the Los Angeles area, you can call (213) 576-3232 to report suspected tax fraud.