October 18, 2001
OFFICE OF THE UNITED STATES ATTORNEY
SOUTHERN DISTRICT OF CALIFORNIA
San Diego, California
United States Attorney
Patrick K. O'Toole
|For Further Information, Contact: Special Assistant U.S. Attorney Danny Roetzel (619) 557-7845|
For Immediate Release
NEWS RELEASE SUMMARY
Patrick K. O'Toole, United States Attorney for the Southern District of California, announced that Jackie D. Brown, owner of Brown's Computerized Mobile Tax Services in San Diego, California, pleaded guilty to subscribing and filing a false 1997 Individual Income Tax Return with the Internal Revenue Service. Brown pleaded guilty before United States Magistrate Judge Larry A. Burns to a charging Information filed September 19, 2001. Sentencing is set for January 7, 2002, before the Honorable James K. Singleton, United States District Judge.
Brown admitted to failing to report $94,816.25 in gross receipts for 1997, from his tax preparation business. Brown owed an additional $31,596.28 in income taxes on his 1997 federal income tax return due to the omitted income. Brown similarly did not report gross receipts from his business for 1994, 1995, 1996 and 1998 on federal income tax returns and owed an additional $87,946.60 in taxes. (Total taxes for 1994 to 1998: $119,542.88).
Brown, as part of his tax return preparation service, assisted clients in securing refund anticipation loans from a bank, and during this process, Brown obtained additional tax return preparation fees directly from the bank for his personal use without the knowledge or consent of his clients. The additional fees to Brown reduced the amount of the refund anticipation loan to the client, usually by $100.00 to $200.00 per refund. Brown, in effect, charged his clients twice for the same tax return preparation service, in that he had been paid once directly by the respective clients but also solicited and accepted a wire transfer fee from the bank for the preparation of the same tax returns. The additional gross receipts received as tax return preparation fees should have been reported on 1994, 1995, 1996, 1997 and 1998 individual income tax returns by Brown.
Brown was released subject to supervision by U.S. Pre-trial Services pending his sentencing. United States Magistrate Burns ordered that Brown not prepare an income tax return for anyone other than himself or an immediate family member while on release.
This case was investigated by agents of the Internal Revenue Service, Criminal Investigation.
Jackie D. Brown
San Diego, California
SUMMARY OF CHARGES
Title 26, United States Code, Section 7206(1), Filing a False Tax Return.
Maximum sentence of three years in prison and fine not to exceed $250,000 per count.
Internal Revenue Service, Criminal Investigation