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Story Update: Rhode Island Businesswoman Sentenced to 8 Years for Fraud, IRS Obstruction

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    Last year, we brought you the story of Monique Brady, a 44 year-old businesswoman from Rhode Island. Ms. Brady pleaded guilty to several counts of wire fraud, aggravated identity theft, and obstruction of the IRS and its investigation. Recently, Brady was sentenced to serve a lengthy prison sentence for her crimes.

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    Defendant Engaged in an Elaborate Scheme, Convicted and Sentenced

    As we reported last year, Brady owned and operated MNB, a company that she maintained was responsible for the rehabilitation of large properties for resale. She sold this falsehood as an opportunity to potential investors who were looking to get into the real estate rehabilitation market. She told the potential investors that the contracts MNB received were large and were valued between $20,000 and $80,000 per contract. She held that she needed their investment to pay subcontractors to perform the work required by the rehabilitation contracts.

    In actuality, MNB was a real company, but with much smaller operations. MNB was indeed hired to do work on properties, such as mowing the grass, removing snow, and performing small tasks such as rewiring electrical fixtures. According to prosecutors and investigators, the average task yielded MNB approximately $1,000. Many projects were between the price points of $25 and $100.

    In an effort to assure her investors that they were indeed investing into a true profitable business venture, Brady created false emails from a management company not associated with Brady, using a stolen identity, indicating that MNB had been awarded large contracts to rehabilitate particular properties.

    Court records show that over half of the 171 properties that Brady told investors she had received large rehabilitation contracts for were properties that she or MNB had no relationship to. The remainder of the properties were those at which Brady was responsible for providing the menial services described above. Brady convinced 31 individuals to invest in her Ponzi scheme by guaranteeing a 50 percent share in the profit earned. In actuality, most investors lost money, resulting in a total loss of nearly $5 million. The investors Brady swindled were primarily those that she knew, including a friend from law school, the nanny of her children, and family friends.

    Defendant Took Deliberate Steps to Obstruct the IRS

    Upon learning that she was under investigation by IRS Criminal Investigation agents, Brady directed her investors to delete all email correspondence, texts, and records related to the rehabilitation projects. Brady admitted that this request was in an effort to obstruct the IRS investigation into her scheme.

    In mid-2019, Brady pleaded guilty to wire fraud, aggravated identity theft, and obstruction of the IRS. Last week, she was sentenced to serve eight years in a federal prison. Additionally, she was ordered to serve three years of supervised release upon the completion of her federal prison sentence. Finally, Brady will be required to repay nearly $5 million in the form of restitution.

    The Importance of a Tax Defense Lawyer

    Although Brady’s case is extreme in nature, it highlights the potential criminal consequences that can stem from committing tax crimes. Namely, Brady’s obstruction of an IRS investigation was particularly egregious. This story should serve as a reminder to taxpayers that seeking the assistance of an experienced tax attorney at the first sign of trouble could help mitigate the negative repercussions that are present in criminal tax cases.

    Whether you have failed to file tax returns in the past or have recently received notice that your tax return is under examination, a tax defense lawyer will work with you to understand the particular facts of your case. Together, you and your tax attorney will develop a plan that works for you and is aimed at maintaining your physical and financial freedom.

    Note:  As long as a taxpayer that has willfully committed tax crimes self-reports the tax fraud (including a pattern of non-filed returns) through a domestic or offshore voluntary disclosure before the IRS has started an audit or criminal tax prosecution, the taxpayer can be successfully brought back into tax compliance and receive a nearly guaranteed pass on criminal tax prosecution and simultaneously receive a break on the civil penalties that would otherwise apply.  It is imperative that you hire an experienced and reputable tax defense attorney to take you through the voluntary disclosure process.  As uniquely qualified and extensively experienced Criminal Tax Defense Tax Attorneys, Kovel CPAs and EAs, our firm provides a one stop shop to efficiently achieve the optimal and predictable results.   See our Testimonials to see what our clients have to say about us!

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    Contact an Experienced Tax Attorney Today

    The tax and accounting professionals at the Tax Law Offices of David W. Klasing have extensive experience representing a diverse group of taxpayers. From individuals to middle market businesses and beyond, our team of zealous advocates will assist in the development of a strategy to help you reach your specific goals and objectives. Whether you are under a tax examination or are in need of tax planning advice, contact the Tax Law Offices of David W. Klasing today, online or by phone at (800) 681-1295, for a reduced-rate consultation.

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