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Former NFL Player Sentenced To More Than 3 Years In Federal Prison For Federal Tax Fraud Conspiracy

FOR IMMEDIATE RELEASE

October 29, 2013

Orlando, Florida –Senior U.S. District Judge John Antoon, II today sentenced Freddie L. Mitchell, II to 37 months in federal prison for conspiracy to file a false tax claim with the government. Mitchell pleaded guilty to the offense on March 8, 2013.      

According to court documents, on November 30, 2009, the Internal Revenue Service determined that a fraudulent 2008 Form 1040 claiming a $1,968,288 tax refund had been filed in the name of a professional athlete (“A.G”).  Agents soon learned that A.G. had been introduced, by Mitchell, to former IRS employee Jamie Russ-Walls.  A.G. had been told by Mitchell that Russ-Walls could help A.G. get extra money back from the IRS.  Mitchell also falsely assured A.G. that Russ-Walls already had helped him receive a $1 million refund.

At the end of July 2009, Jamie Russ-Walls and Richard Walls flew to Orlando and met with A.G. and Mitchell.  Jamie Russ-Walls indicated that she and her husband worked in the tax preparation business.  After providing copies of his tax records to the couple, A.G. was told that he could get additional money back from the IRS because of "grey areas" in his tax returns.  A.G. eventually made a $100,000 down payment to Mitchell towards the tax preparation fee, which Mitchell deposited it into his bank account.  Mitchell eventually split the fee with Jamie Russ-Walls and Richard Walls.

Without A.G.'s knowledge, Mitchell, Jamie Russ-Walls and Richard Walls then electronically submitted a fraudulent 2008 Form 1040, in A.G.'s name, to the IRS.  The form included false business losses totaling $5,367,775, resulting in a fraudulent refund of $1,968,288.  A.G. never had any involvement in these businesses and never had provided the information on the tax schedule to Mitchell, Jamie Russ-Walls, or Richard Walls.  The false return also included paperwork asking the IRS to directly deposit the refund into the bank accounts of Mitchell and Jamie Russ-Walls.  A.G. subsequently learned of the fraudulent activity when the IRS rejected his regular tax return that was filed on October 14, 2009.  The IRS was then able to cancel payment on the fraudulent return.
During the investigation, agents also discovered five other false 2009 returns totaling $2,264,005 that had been submitted by Mitchell, Jamie Russ-Walls and Richard Walls.  Each of these claims had been accompanied by false W-2 forms showing wages in the millions of dollars from Chameleon Enterprises, LLC.  Mitchell had incorporated this business in 2003, listed himself as the manager, and opened a mailbox in Kathleen, Florida to receive correspondence.  When contacted by the IRS about the wages allegedly paid to these five individuals, Mitchell falsely verified their employment and income.  Records checks later revealed that Chameleon actually had been dissolved as a corporation by the State of Florida in 2007 and therefore did not pay any wages in 2009.

Jamie Russ-Walls and Richard Walls previously pleaded guilty and were sentenced for their roles in this case.  On February 1, 2013, Jamie Russ-Walls was sentenced to five years of probation.  On February 14, 2013, Richard Walls was sentenced to 37 months in federal prison. 

This case was investigated by the Internal Revenue Service – Criminal Investigation. It is being prosecuted by Assistant United States Attorney Robert E. Bodnar, Jr.

 

 

 

 

 

 

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