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Husband and Wife Plead Guilty to Tax Evasion & Bankruptcy Fraud, SNAP Benefits Scheme

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Husband and Wife Plead Guilty to Tax Evasion & Bankruptcy Fraud, SNAP Benefits Scheme

 

The IRS recently announced that Abraham and Samar Elsaghir had pled guilty to multiple charges, including lying to an agency of the United States, tax evasion, and bankruptcy fraud. Prosecutors alleged that the couple, amongst other violations, made false statements on tax filings in order to improperly secure qualifications for food stamps.

Fraudulent schemes to abuse government public assistance programs are one of many areas of focus for the IRS’ Criminal Investigations Division (IRS-CI). Taking the recent statements and actions of the federal government’s tax agency together, it is clear that audits, as well as criminal investigations and prosecutions, are on the upswing.

To find out more about how you can safeguard yourself from getting caught up in the recent wave of IRS criminal investigative and prosecutorial activity, get in touch with one of the Dual Licensed Tax Attorneys and CPAs at the Tax Law Offices of David W. Klasing by calling (800) 681-1295 today.

Husband and Wife Plead Guilty for False Statements to a United States Agency, Tax Evasion, and Bankruptcy Fraud

Two married defendants from Dearborn Michigan were arraigned and pled guilty on February 23, 2022. Abraham Elsaghir, 52, pled guilty to one count of making a false statement to an agency of the United States, one count of tax evasion, and one count of bankruptcy fraud. Samar Elsaghir, 51, pled guilty to one count of false statement to an agency of the United States and one count of tax evasion.

According to the information and the plea agreements, in May 2017, Abraham and Samar Elsaghir filed a voluntary Chapter 7 petition for bankruptcy, and they received a discharge of their debts in August 2017. As the plea agreement acknowledges, however, the Elsaghirs made false declarations in their bankruptcy petition, by both failing to report and underreporting their income.

During the same time period, the Elsaghirs made similar false statements to both the I.R.S. on their 2016 tax return and to the U.S. Department of Agriculture in order to receive Supplemental Nutritional Assistance Program (SNAP) benefits, better known as food stamps.

In the plea agreements, the Elsaghirs agreed that, from 2014 to 2020, they had received nearly $60,000 in SNAP benefits they were not entitled to receive and that they, in fact, owed the IRS an additional $70,000 for all tax calendar years from 2014 to 2018. Abraham Elsaghir also agreed he owed and to pay over $166,000 to unsecured creditors in the bankruptcy case.

Both Abraham and Samar Elsaghir will appear for sentencing before Judge Laurie J. Michelson of the District Court for the Eastern District of Michigan on June 23, 2022. Both spouses face up to five years in prison, in addition to any monetary penalties or ordered restitution.

The Government is Investigating Schemes that Target Federal Assistance Programs

Not only is the government aware that there has been an increase in fraudulent schemes targeting government aid efforts, but they are actively increasing efforts to seek out the abusers for prosecution. There are a number of agencies involved in this effort, including the IRS, the FBI, and various District Attorneys’ Offices.

“We have seen an unprecedented number of people commit fraud on government programs,” said Josh Hauxhurst, Acting Special Agent in Charge of the FBI’s Detroit Division. This case involved multiples layers of deception – lying to the bankruptcy court, the IRS, and the [U.S. Department of Agriculture]. This conduct will not be tolerated, and individuals who make false statements to exploit resources intended for those most in need will be vigorously investigated and prosecuted.”

“The Elsaghirs’ plea serves as an important reminder that Federal income tax compliance should be equally shared among all Americans,” said Detroit IRS Criminal Investigation Special Agent in Charge Sarah Kull. “Conspiring to defraud the government with a scheme to underreport taxable income and to steal money meant for low-income families is unlawful and shameful.” 

Other Focuses of IRS Investigative Efforts

With a new budget, updated technological sophistication, and an intense mandate from the White House, the IRS is looking to root out tax noncompliance in more areas than just SNAP and bankruptcy processes. Below are some of the areas in which the government has expressed significant interest in recent weeks and months.

COVID-19 Relief Program Schemes

As more information comes out about how federal pandemic assistance funds were obtained and used, it is becoming clear that many exploited the government’s aid efforts for their own illicit gain. To combat this, President Biden has signaled his administration’s willingness to go back through the record and investigate these issues, even going so far as to mention it in his most recent “State of the Union” address to Congress.

Foreign Asset Nondisclosure

Many U.S. taxpayers who have long had assets or accounts in foreign countries have avoided any issues because of the IRS’s limited capabilities in these areas. However, the federal tax watchdog has recently secured several favorable judgments concerning their ability to require foreign entity cooperation, making it more likely that past international tax issues that went undiscovered could now present themselves.

Cryptocurrency

As Bitcoin and other cryptocurrencies gain popularity, it is important to understand how the tax code treats them. This can be complicated, especially because tax legislation is likely to undergo changes as the use of crypto develops. If you need help recording and declaring your crypto assets and income, we urge you to contact our Dual Licensed Tax Lawyers and CPAs today.

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The Tax Law Offices of David W. Klasing Can Provide the Tax Defense You Deserve

If you are concerned about how the uptick in criminal tax investigations and prosecutions may affect you or your small business, you should act soon before it is too late. To find out more about the services that our Dual Licensed Tax Attorneys and CPAs can provide, call us at the Tax Law Offices of David W. Klasing today at (800) 681-1295.

If you have failed to file a tax return for one or more years or have taken a position on a tax return that could not be supported upon an IRS or state tax authority audit, eggshell audit, reverse eggshell audit, or criminal tax investigation, it is in your best interest to contact an experienced tax defense attorney to determine your best route back into federal or state tax compliance without facing criminal prosecution.

Note: As long as a taxpayer that has willfully committed tax crimes (potentially including non-filed foreign information returns coupled with affirmative evasion of U.S. income tax on offshore income) self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosurebefore the IRS has started an audit or criminal tax investigation / prosecution, the taxpayer can ordinarily be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously often receive a break on the civil penalties that would otherwise apply. 

It is imperative that you hire an experienced and reputable criminal tax defense attorney to take you through the voluntary disclosure process. Only an Attorney has the Attorney Client Privilege and Work Product Privileges that will prevent the very professional that you hire from being potentially being forced to become a witness against you, especially where they prepared the returns that need to be amended, in a subsequent criminal tax audit, investigation or prosecution.

Moreover, only an Attorney can enter you into a voluntary disclosure without engaging in the unauthorized practice of law (a crime in itself). Only an Attorney trained in Criminal Tax Defense fully understands the risks and rewards involved in voluntary disclosures and how to protect you if you do not qualify for a voluntary disclosure.

As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, KovelCPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results that simultaneously protect your liberty and your net worth. See our Testimonials to see what our clients have to say about us!

If you failed to provide accurate information to the IRS, you may be facing tax fraud charges if you do not come into compliance through a domestic or offshore voluntary disclosure. Our experienced dual licensed California Tax Fraud Defense Lawyers and CPAs are here to help. Call the Tax Law Offices of David W. Klasing at (800) 681-1295 to arrange a consultation with our team or schedule a reduced rate initial consultation directly HERE.

Regardless of your business or estate needs, the professionals at the Tax Law Offices of David W. Klasing are here for you. We are open for business and our team will help ensure that your business is too. Contact the Law Offices of David W. Klasing today to discuss your business with one of our professionals.

In addition to our main office in Irvine, the Tax Law Offices of David W. Klasing has unstaffed (conference room only) satellite offices in Los Angeles, San Bernardino, Santa Barbara, Panorama City, Oxnard, San Diego, Bakersfield, San Jose, San Francisco, Oakland, Carlsbad and Sacramento.

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