Tax Plea in First Time Home Buyers' Credit Scheme
Memphis, TN – Edward L. Stanton III, U.S. Attorney for the Western District of Tennessee, announced today Kenneth Harris, of Memphis, Tennessee, pled guilty to one count of conspiracy to file a false claim against the United States. He faces a maximum penalty of ten years in prison and a fine of $250,000 when he is sentenced on March 23, 2011.
According to an Information filed with the court, from January 1, 2009, until July 14, 2009, Harris and an individual named Lacrecia Ward, conspired with each other to defraud the United States by filing false tax returns with the Internal Revenue Service (IRS) claiming First Time Home Buyers Tax Credits. The Information states that Ward worked as a runner for Harris, helping to locate individuals to participate in the scheme.
Harris, operating a tax preparation business named Harris and Associates Tax Service, orchestrated a scheme to find individuals who did not qualify for the First Time Home Buyers Tax Credit and prepared fraudulent tax returns stating the filer had purchased a home. Harris would also include false and fraudulent tax deductions on the filer’s tax return to inflate the amount of the refund. The filer would have to divide the refund with Harris in exchange for his preparation of the return.
Harris admitted during his plea hearing that the tax loss to the United States from the filling of these fraudulent returns was $2.7 million in fraudulent refunds.
United States Attorney Edward L. Stanton, III stated: “Our office is continuing its work with the IRS to bring to justice those individuals submitting false and fraudulent tax information. We will continue to prosecute to the fullest extent of the law those individuals who unlawfully defraud the United States for their own personal gain.”
“Refunds should only be issued to taxpayers who are entitled to them. Regardless of what you call it, theft from the government is theft from honest taxpayers. At the IRS, protecting taxpayer money is a matter we take extremely seriously,” said Christopher R. Pikelis, Special Agent in Charge, IRS Criminal Investigation-Nashville Field Office.
This investigation was conducted by IRS Special Agent Shari Paige. Assistant U.S. Attorney Stephen C. Parker represented the government.
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