A 63-count superseding indictment charging Chatonda Khofi, Ishmael Kosh, Amadou Sangaray and Francis Saygbay in a conspiracy to defraud the Internal Revenue Service (IRS) was unsealed on Monday, December 23, in Minneapolis, Minn., the Justice Department and IRS announced today. The superseding indictment was returned by a federal grand jury on Nov. 19, 2013, and alleges that Primetime Tax Services Inc. was a tax return preparation business with three storefronts in the Minneapolis area. Khofi worked as the Chief Executive Officer of Primetime, and Kosh and Sangaray worked as managers of the Brooklyn Center location of Primetime. All four named defendants allegedly prepared false tax returns under the name of Primetime.
According to court documents, Khofi, Kosh, Sangaray and Saygbay conspired amongst themselves and with others to prepare and file false individual income tax returns for the customers of Primetime. Some of these returns reported false dependents, false deductions, false Schedule C business losses and false wage income. These false entries resulted in fraudulently inflated refunds for their customers. As part of the scheme, court documents allege that the defendants prepared and filed false Minnesota state income tax returns for their customers that contained the same or similar false information as reported on the federal income tax returns. From 2007 to 2009, Primetime filed over 2,000 customer federal income tax returns with the IRS.
The indictment further charges each defendant with multiple counts of aggravated identity theft and multiple counts of aiding and assisting in the preparation of false individual income tax returns. The aggravated identity theft charges stem from the defendants’ alleged use of the names and social security numbers of actual persons to falsely claim as dependents on their customers’ individual income tax returns.
According to the indictment, the defendants also accompanied some customers to check-cashing businesses to cash their falsely inflated tax refund checks, then demanded a portion of the cashed refund check in addition to tax preparation fees already collected. The indictment alleges that, in some instances, the defendants withdrew cash from debits cards containing their customers’ refunds without permission, again in addition to the tax preparation fees they had already collected.
An indictment is merely an allegation and all defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law. If convicted, the defendants face a maximum potential sentence of five years in prison for the conspiracy count and three years in prison for each count of aiding in the preparation of a false tax return. The aggravated identity theft counts have a mandatory two year sentence.
The case was investigated by special agents of IRS-Criminal Investigation. It is being prosecuted by Trial Attorneys Dennis Kihm and Thomas Flynn of the Justice Department's Tax Division.