News

False Tax Returns Bring Three Year Sentence for Prince George’s County Man


Claimed Refunds of Over $563,000 to Which He Was Not Entitled

FOR IMMEDIATE RELEASE
March 16, 2009

Greenbelt, Maryland - U.S. District Judge Deborah K. Chasanow sentenced Wayne Eric Matthews, age 43, of Bowie, Maryland, today to three years in prison, followed by three years of supervised release, after he was convicted on December 10, 2008, on two counts of filing a false claim with the IRS, announced United States Attorney for the District of Maryland Rod J. Rosenstein. Judge Chasanow also ordered Matthews to pay restitution of $231,560.

“Anyone who files a false tax return should be prepared to suffer the consequences,” said U.S. Attorney Rod Rosenstein. “Wayne Matthews stole from the U.S. Treasury by filing false tax returns claiming that federal income taxes had been withheld and were due to be refunded to him.”

“While taxpayers have the right to contest their tax liabilities in the courts, taxpayers do not have the right to violate and disobey tax laws. IRS-Criminal Investigation will vigorously investigate those individuals who use abusive trust arrangements to evade their tax obligation," stated C. Andre' Martin, Internal Revenue Service-Criminal Investigation Special Agent in Charge.

According to testimony at his December 2008 trial, on February 12, 2007, Matthews sent to the IRS a tax return for 2006 in the name of the “WAYNE MATTHEWS TRUST” and listed “Wayne Eric Matthews” as the fiduciary. In this return, Matthews claimed that the trust had income of $694,680 and a deduction of $694,680 for fiduciary fees. Matthews also claimed that $231,560 in federal income tax withheld had been paid to the IRS, and therefore that the Trust was owed a refund of $231,560. Matthews did not include any trust documents, designation of beneficiaries, proof of income, or proof of withholding with the return when he submitted it to the IRS, nor did the IRS have any evidence of income or withholdings for the Trust. The IRS issued a check on March 20, 2007, made payable to the Wayne Matthews Trust, in the amount of $231,560, which was the claimed refund amount. The check was deposited on March 26, 2007.

Less than two months later, on May 15, 2007, Matthews filed an almost identical return for tax year 2005, also claiming a refund of $231,560. Based upon an on-going investigation, a refund check was not issued for the second claim.

Testimony at trial showed that the WAYNE MATTHEWS TRUST was not established until after the refund check was received and had no withholdings reported to the IRS.

United States Attorney Rod J. Rosenstein thanked the Internal Revenue Service - Criminal Investigation for their investigative work, and commended Assistant United States Attorneys Stacy Dawson Belf and David I. Salem, who are prosecuting the case.

 

 

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