Charity for none; Dr. Backdate; frivolous correspondence; and other highlights of recent tax cases.
Atlanta: John Crittenden, a professor of environmental engineering at the Georgia Institute of Technology and the former director of the Brook Byers Institute for Sustainable Systems, has pleaded guilty to tax fraud for lying on his returns by overstating charitable deductions.
Crittenden’s academic research focused on scalable water treatment systems and technologies. He had deep ties to China in part due to his position at Georgia Tech and his research. While employed at Georgia Tech and living in the United States, he partnered with a Chinese national, Duo Li, to operate several companies in China.
These companies, as well as individuals associated with Duo Li, wired hundreds of thousands of dollars either directly to the charitable donation arm of Georgia Tech, the Georgia Institute of Technology Foundation (GTF) or to Crittenden’s Bank of America account, after which he “donated” the funds to GTF.
When the funds arrived at GTF, they were earmarked for Crittenden’s use at Georgia Tech. Regardless of how the funds reached the foundation, Crittenden improperly and falsely claimed the transfers as charitable deductions on his returns without recognizing any of the transfers as income.
Crittenden also received transfers to his Bank of America account from Chinese nationals who were participating in post-doctoral research at Georgia Tech. Crittenden then “donated” these funds to the foundation and improperly and falsely took a charitable deduction on his returns while not recognizing any of the funds as income. Neither Georgia Tech nor the foundation were aware that Crittenden was conducting this tax fraud.
Crittenden must resign from all positions of employment at the Georgia Institute of Technology and the Georgia Tech Research Institute, pay all taxes owed for 2011 through 2021, and cooperate with the IRS in making a complete and accurate determination of all taxes, penalties and interest that he owes.
Sentencing is Jan. 16.
Cody, Wyoming: Susan K. Patrick, formerly of Maryland, has pleaded guilty to filing a false return.
Patrick co-owned a media brokerage firm with her husband and hired an accounting firm to prepare business and personal returns for 2012 through 2014. Patrick did not file the federal returns, and after being contacted by the IRS claimed that her accounting firm, which had provided her with the returns, had timely filed them and that she would provide copies.
Instead, Patrick doctored the returns, removing $10 million in gross receipts earned by her brokerage firm. She altered the personal returns by removing more than $9.5 million in income that she and her husband had earned from 2012 through 2014 and falsely backdated her signature on each return to make it appear as if the returns had been timely signed and mailed.
Patrick also failed to timely file business and individual returns for 2015, which she had also hired the accounting firm to prepare, nor did she pay the tax due for the individual return.
In total, she sought to evade more than $2.5 million in taxes.
She faces up to three years in prison, as well as a term of supervised release, monetary penalties and restitution.
Orlando, Florida: Tax preparer Rafael Ramos has pleaded guilty to conspiring to defraud the U.S., filing a false return and aiding and assisting the preparation of a false return.
Ramos recruited clients and prepared returns on their behalf that falsely claimed banks and other financial institutions had withheld large amounts of tax from the clients’ income, entitling them to federal refunds. Ramos and his conspirators also filed false documents with the IRS, purporting to have been issued by the banks, to support the false withholdings.
When the IRS tried to collect the fraudulently issued refunds, Ramos met with his clients and provided them with frivolous correspondence to send to the IRS, instructing clients to lie that they had self-prepared their returns and to move funds out of their bank accounts to avoid levies.
The scheme caused a tax loss totaling more than $1.15 million.
Sentencing is Nov. 30. Ramos faces up to five years in prison for conspiracy and three years for each false return count. He also faces a period of supervised release, restitution and monetary penalties.
New Orleans: Nicole Burdett, the co-defendant and former law partner of Orleans Parish District Attorney Jason Williams, has been sentenced to five years of probation for tax fraud, news outlets said.
Burdett, 42, of Kenner, Louisiana, was on trial with Williams in 2022, each facing 10 counts in a tax fraud and conspiracy case brought by the federal government in connection with Williams’ private law firm, where Burdett was an office manager and law partner, reports said.
Williams and Burdett were acquitted, reports added, but Burdett was found guilty of four felony tax fraud counts brought in a separate indictment that accused her of falsifying personal returns with more than $280,000 in inflated business expenses for tax years 2014 to 2017.
Prosecutors had sought at least 20 months in prison, reports added.
Houston: Tax preparer Fabrice Mahinga has been sentenced to 33 months in prison to be followed by a year of supervised release for preparing a false joint 2017 individual income tax return.
Mahinga, who pleaded guilty late last year, admitted that from 2016 to 2018 he operated Kennedy Tax Service and that he often claimed fake Schedule C items, education and fuel tax credits on the returns he prepared.
In 2019, he helped prepare a return that should have resulted in a tax owed of $42. Mahinga added to the return a false Schedule C and false credits that resulted in a false claim for a federal refund of $4,257. A copy of the return also reflected a false income tax refund of a lesser amount.
Mahinga took responsibility for $270,612 of loss to the IRS and agreed to pay $182,212 in restitution.
The court heard additional evidence that Mahinga had a notable criminal history. In handing down the sentence, the court remarked on the seriousness of his criminal conduct, particularly given his status as a refugee in the United States.
Midland, Texas: Tamara Dawn Allen has been sentenced to 30 months in prison and ordered to pay $1,251,416.67 in restitution for wire fraud and filing a false return.
While working as a secretary for a local drilling equipment company, she fraudulently cashed her employer’s checks using the owner’s signature stamp and made electronic payments to her personal bank accounts from company accounts. The scheme amounted to a total loss of at least $868,770.60.
Additionally, Allen underreported her income on her taxes over four years, for a total of $553,390.
Allen pleaded guilty to two counts of a 31-count superseding indictment on May 12.
