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Florida Return Preparer Admits to Using Stolen Identities of Dead Taxpayers in IRS Refund Scam

According to court records, a group of four men have been charged with tax crimes after stealing information from deceased taxpayers to illegally obtain tax refunds from the IRS. The men, who previously operated a tax preparation business in the Miami region of Florida, have been identified as Edy St. Jean, Hugues Jean Noel, Frandy Prophete, and Saul Frederick – the latter of whom was sentenced last month to more than five years in prison. Two of Frederick’s co-defendants, Noel and Prophete, met with similar fates in court, while St. Jean, whose whereabouts are currently unknown to the authorities, for now “remains a fugitive,” according to a Department of Justice (DOJ) press release.

Over $1.75M in Restitution, 5 Years in Prison for Former Tax Preparer

In December 2018, officials representing the IRS’ Criminal Investigation Division (IRS-CI), the United States Secret Service, and local law enforcement appeared to make an announcement regarding 45-year-old defendant Saul Frederick: after pleading guilty to one count of aggravated identity theft (18 U.S. Code § 1028A), in addition to one count of “conspiracy to file false claims” (18 U.S. Code § 286), Frederick, a former tax preparer from Port-au-Prince, Haiti, had been sentenced to serve a formidable term of 61 months – just over five years in federal prison. He was also ordered to pay restitution totaling just under $1,757,400.

The charges arose from Frederick’s participation, alongside three co-conspirators, in what the DOJ described as a “stolen identity tax refund scheme.” (Perhaps this is unsurprising, as the IRS regularly lists identity theft among the “Dirty Dozen” featured in its annual compilation of tax scams.)

In order to execute this scheme, Frederick, who previously worked with his co-conspirators at North Miami-based tax preparation company H&A Tax Multi-Service, LLC, “used stolen personal identification information (PII) to prepare and file false federal income tax returns with the Internal Revenue Service (IRS) for tax years 2009 and 2010.” In an unsavory twist, much of this information was taken from individuals who had passed away during the same two tax years. As Frederick explained in one statement, the stolen information, which “included names and Social Security numbers,” was taken “for the purpose of filing unauthorized tax returns in tax years 2009 and 2010.”

In addition to obtaining and reporting stolen information, the co-conspirators also “used fabricated employment and income information” in furtherance of their scheme.

Other than St. Jean, whose location is unknown to investigators, all co-defendants in the case have been sentenced – none leniently. Prophete, like Frederick, was given a prison term of 61 months, to be followed by three years of supervised release. In addition to incarceration and follow-up supervision, Prophete was also “ordered to pay $1.85 million in restitution.”

Though many factors can impact sentencing, it is unsurprising that Prophete and Frederick received similar penalties, as both men were charged with identical crimes: one count each of aggravated identity theft and filing false claims. Noel, who was charged with three offenses – one count of aggravated identity theft, one count of failure to appear (18 U.S. Code § 3146), and one count of conspiracy to defraud the federal government (18 U.S. Code § 371) – received even harsher penalties: a devastating 75-month sentence (six years and three months), in addition to four years of supervised release, plus restitution of nearly $1.8 million.

Federal Criminal Tax Defense Lawyers in California

With high rates of conviction and incarceration, tax crimes can have harsh, life-altering ramifications for any defendant. The stakes are especially high for tax professionals, such as CPAs and tax preparers, who risk irreversible professional damage in addition to civil and criminal penalties. For an accountant, EA, CTEC certified preparer or tax attorney, a tax crime conviction most likely spells the end of a lifelong career.

If you have been charged with tax evasion or related offenses, make sure that you are represented by a reputable tax fraud defense lawyer who is experienced, knowledgeable, and aggressive. At the Tax Law Office of David W. Klasing, our Santa Barbara tax evasion attorneys merge decades of experience working on high-stakes criminal cases. Proficient, strategic, and motivated, our award-winning attorneys are eminently qualified to provide the sophisticated representation you need in federal court. Contact us online immediately if you have been charged with a tax crime or call our tax office at (800) 681-1295 to arrange a reduced-rate legal consultation.

Also, we’ve expanded our offices! In addition to our offices in Irvine and Los Angeles, the Tax Law Offices of David W. Klasing now have offices San BernardinoSanta BarbaraPanorama CityOxnardSan DiegoBakersfieldSan Jose, San FranciscoOakland and Sacramento.

 

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