Former Fountain Hills Residents Admit to False Claims

Couple submitted false tax returns claiming over $1.5 million in refunds

            PHOENIX – Kevin M. Silva, 53, and Christine A. Silva, 67, both currently of Castro Valley, Calif., pleaded guilty today in federal district court to conspiracy to defraud the government with respect to claims and false claim upon the United States.

                 “Claiming false tax refunds is theft and carries serious consequences,” said Acting U.S. Attorney Ann Birmingham Scheel. “We will continue to work with our partners at the IRS to hold accountable those who fraudulently take government funds by submitting false tax refund claims.”

                 “Individuals involved in fraudulent tax refund schemes think there is a secret formula to get free money” said Dawn Mertz, Special Agent in Charge of Internal Revenue Service Criminal Investigation.  “We want to make it clear that participating in one of these bogus schemes can send you to prison.”

            Kevin and Christine Silva, former residents of Fountain Hills, Ariz., agreed today to be charged by Information. In the course of their guilty pleas, the Silvas admitted to conspiring and agreeing to participate in a scheme to obtain payment of false claims for refunds from the IRS by filing false federal income tax returns. In each instance, the Silvas claimed refunds to which they knew they were not entitled. All of the fraudulent claims were based primarily upon representations that money had been withheld by various financial institutions on behalf of the couple during the subject tax years and that the couple was entitled to the claimed withholdings. No such withholdings ever occurred. In support of each claim, the Silvas submitted to the IRS various false IRS Forms 1099-OID. The Silvas admitted the following with respect to each return:        

Tax Year	Tax Payer	Date Filed	Amount Claimed	Amount Paid by IRS
2005	Kevin M. Silva	7/1/2008	$559,172	$566,388
2005	Christine A. Silva	7/11/2008	$557,514	$0
2006	Christine A. Silva	9/2/2008	$130,346	$0
2006	Kevin M. Silva	9/3/2008	$153,501	$244,363
2007	Kevin M. Silva	9/4/2008	$143,501	$0

                 In total, the Silvas admitted to falsely claiming $1,544,034 in refunds and agreed to repay $569,469 that remains outstanding with the IRS.

                 A conviction for conspiracy to defraud the government with respect to a claim carries a maximum penalty of 10 years in prison, a $250,000 fine, or both. A conviction for false claim upon the United States carries a maximum penalty of 5 years in prison, a $250,000 fine, or both. In determining an actual sentence, U.S. District Judge David G. Campbell will consult the U.S. Sentencing Guidelines, which provide appropriate sentencing ranges. Judge Campbell, however, is not bound by those guidelines in determining a sentence.

                 Sentencing is set before Judge Campbell on August 27, 2012 at 3:00pm.

                 The investigation in this case was conducted by Internal Revenue Service Criminal Investigation. The prosecution is being handled by Frederick A. Battista, Assistant U.S. Attorney, District of Arizona, Phoenix.

CASE NUMBER:           CR-12-1128-PHX-DGC
RELEASE NUMBER:   2012-139(Silva_etal)

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For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/