PHOENIX MAN ADMITS TO TAX FRAUD AND AGREES TO REPAY OVER $239,000

Claimed more than $600k in false tax refunds

            PHOENIX – Elmer Lee Defoor, 52, of Phoenix, pleaded guilty on March 12, 2012, to False Claim Upon the United States, in federal district court in Phoenix.

            “When an individual submits false tax returns to acquire fraudulent tax refunds, not only is the nation’s treasury affected, but the law-abiding taxpayer is also harmed,” said Acting U.S. Attorney Ann Birmingham Scheel. “The United States Attorney’s Office will continue to work with our partners at the IRS to prosecute those who engage in fraudulent tax refund schemes.”

Dawn Mertz, Special Agent in Charge of IRS Criminal Investigation said, “Individuals who promote and participate in fraudulent tax refund schemes think they can make money out of thin air. There is no secret formula to get free money. Unfortunately, these schemes only result in law enforcement scrutiny and possible prison time.”

In the course of his guilty plea, Defoor admitted that on Feb. 7, 2009, he knowingly filed and presented a claim for payment to the Internal Revenue Service which he knew to be false. The claim was in the form of his 2008 federal income tax return, in which he falsely claimed an income tax refund of $239,274 was due. Defoor also agreed to repay this amount to the United States. In order to assist the Court in determining the appropriate sentence in the case, Defoor also admitted that he knowingly filed two additional fraudulent tax returns on Sept. 27, 2008 for the 2005 and 2006 tax years. In the 2005 tax return, he falsely claimed an income tax refund of $76,233. On his 2006 tax return, Defoor falsely claimed a refund of $182,375.  He also filed a fourth fraudulent tax return on Aug. 3, 2010, for the 2009 tax year.  In the 2009 tax return, he falsely claimed a refund of $132,752. The false claims in each of the four tax years were primarily based upon claims that money had been withheld by various financial institutions on behalf of Defoor during each tax year and that he was entitled to the withholdings; no such withholdings ever occurred. In support of each claim, Defoor submitted various false Forms 1099 to the Internal Revenue Service.

            A conviction for False Claim Upon the United States carries a maximum penalty of five years in prison, a $250,000 fine or both.  Sentencing is set before Judge David G. Campbell for June 18, 2012.
The investigation in this case was conducted by the Internal Revenue Service.  The prosecution is being handled by Frederick A Battista, Assistant U.S. Attorney, District of Arizona, Phoenix.

CASE NUMBER:           CR-11-700-PHX-DGC
RELEASE NUMBER:   2012-061(Defoor)

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