SALISBURY MAN SENTENCED TO CONSPIRACY

Baltimore - United States Attorney Thomas M. DiBiagio and Special Agent in Charge Vicki Duane of the Internal Revenue Service - Criminal Investigation, announced that Terrance D. Everett, 30, of Salisbury, Maryland was sentenced before the Honorable Judge Andre M. Davis on May 24, 2002 on a charge of conspiracy to defraud the United States with respect to claims, in violation of 18 U.S.C. § 286 to two (2) years incarceration, three (3) years supervised release, $100 special assessment.

The conviction was based on Everett's conspiring with others to prepare or cause to be prepared and filed with the Internal Revenue Service at least 41 false and fraudulent claims for federal income tax refunds in the guise of U.S. Individual Income Tax Returns for the year 1997. At least 41 of those false and fraudulent returns were submitted by his co-conspirators, in concert with Everett, from Salisbury, Maryland, and mailed to Philadelphia, Pennsylvania. The conduct occurred between approximately January 1, 1998 and October 31, 1998.

Each return that reported income was supported by an attached or associated IRS Form W-2, Wage and Tax Statement reporting wages of approximately $12,000 supposedly paid by area employers. Most of the W-2s reported relatively high amounts of federal income tax withheld from said wages, usually $1,500 to $2,000. In fact, the W-2 forms were not issued by the employers as represented on the documents. Further, the person listed on the W-2 form was not employed by the stated employer.

Nearly, all the returns were filed listing the "taxpayer" as a single, head of household with one or two dependent children, therefore maximizing the refundable earned income tax credit of about $3,500. Everett rented or caused others to rent numerous post office boxes at several different post offices in the Salisbury, Maryland area to be used as return addresses on the returns and for receipt of fraudulently obtained refund checks. In addition, Everett was often responsible for cashing the fraudulently obtained refund checks.

Many of the returns shared similar (sometimes identical) traits or characteristics that indicate a limited number of common sources. Such common traits included use of the same addresses, employers, amounts of income and withholding, and dependents claimed.

The tax loss computed pursuant to U.S.S.G. § 2T1.1 of the Sentencing Guidelines, based on total amount listed as refunds due and payable in this scheme, is approximately $181,000.00, though Everett personally received only a portion of that sum.

This case was prosecuted by Assistant U.S. Attorney Bonnie S. Greenberg and investigated by the Internal Revenue Service - Criminal Investigation.