United States Attorney Anne M. Tompkins
Western District of North Carolina
The Defendants Filed Over 1,000 False Tax Returns and
Received Over $3.5 Million in Fraudulent Tax Refunds
ASHEVILLE, N.C. – A Polk Co. couple charged with tax refund conspiracy pleaded guilty today in U.S. District Court in Asheville, announced Anne M. Tompkins, U.S. Attorney for the Western District of North Carolina.
U.S. Attorney Tompkins is joined in making today’s announcement by Jeannine A. Hammett, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI) and Keith Fixel, Inspector in Charge of the Charlotte Division of the U.S. Postal Inspection Service.
A criminal bill of information filed on October 23, 2012, charged Senita Birt Dill, 45, and Ronald Jeremy Knowles, 40, both of Mill Spring, N.C. with one count of false claims conspiracy, one count of access device fraud and one count of aggravated identity theft. According to the charging document, the plea agreement and statements made in court, from 2009 to 2012 the defendants participated in a scheme to obtain false tax refunds by filing false tax returns using fraudulently obtained personal identification information (such as names, dates of birth and social security numbers).
According to court documents, the defendants filed federal and state tax returns using tax preparation software programs. The defendants used fictitious information pertaining to the filer’s income and amount of federal tax withheld, and, in doing so, were careful to use figures that would maximize the amount of the refund and minimize the risk of detection. Court records show that the defendants engaged in an elaborate scheme to collect the fraudulent tax refunds. For example, the defendants rented a home on a lake in a neighborhood surrounded by vacation homes and then used neighboring addresses on the fraudulent tax returns. Since the vacation homes were not occupied daily, the defendants were able to monitor the mailboxes and retrieve the fraudulent refund checks from those mailboxes upon delivery. The defendants also used addresses in Greenville and Greer, S.C. on the fictitious tax returns, which is where Knowles’ business is located. Once they retrieved the refunds, the defendants would deposit the refund checks directly into their bank accounts. On some occasions, the defendants received tax refunds in the form of pre-paid debit cards, court records show.
Filed documents indicate that the defendants filed over 1,000 false tax returns using the fraudulently obtained personal identification information. They also made fraudulent tax refund claims in excess of $5 million and actually received tax refunds totaling over $3.5 million.
Dill has pleaded guilty to all three counts contained in the bill of information. Knowles has pleaded guilty to false claims conspiracy and access device fraud. Both defendants are currently in local federal custody. The false conspiracy count carries a maximum of 10 years in prison and a $250,000 fine. The access device fraud count carries a maximum of 15 years in prison and a $250,000 fine, and the aggravated identity theft count carries a maximum prison term of two years in prison.
A federal judge will determine Knowles and Dill’s actual sentence at their sentencing hearings which have not been scheduled yet.
The investigation of the case was handled by IRS and USPIS, with the assistance of the Polk County Sheriff’s Office. The prosecution of the case is handled by Assistant U.S. Attorney Don Gast of U.S. Attorney’s Office in Asheville.