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Wednesday, March 4, 2015

California Resident Sentenced to Prison for Tax Evasion Resulting from Multimillion-Dollar Advance Fee Scheme in Maryland

A Corona, California, woman was sentenced today in the U.S. District Court in the District of Maryland to serve two years in prison to be followed by three years of supervised release after pleading guilty to one count of tax evasion, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Rod J. Rosenstein of the District of Maryland. 

Yvette Johnson, formerly of Laytonsville, Maryland, was sentenced by U.S. District Judge Deborah K. Chasanow.  As a special condition of Johnson’s supervised release, she is required to cooperate with the Internal Revenue Service (IRS) to determine all taxes owed for tax years 2002 through 2009, and to pay the IRS all additional taxes, interest and penalties.

Johnson’s husband, Shannon Johnson, was sentenced in June 2014 to serve seven years in prison after pleading guilty to an advance fee scheme and tax evasion.  The Johnsons were indicted by a federal grand jury in June 2013 for mail and wire fraud charges, as well as tax fraud charges, in connection with a scheme to defraud investors.  Shannon Johnson admitted that he ran a fraudulent advance fee scheme from 2006 to 2009, wherein Johnson presented himself as a wealthy international investment banker who could provide millions of dollars and euros in financing to businesses and individuals.  In return for substantial advance banking fees, the indictment alleged that the Johnsons promised to provide investors with money which they claimed they held in an overseas bank account.  Shannon Johnson provided these businesses and investors with false documents purporting to be from the overseas bank to authenticate the funds.  The Johnsons developed relationships with pastors, ministers and religious-based organizations to sell themselves as philanthropists on a humanitarian mission.  Shannon Johnson received payments and gifts from pastors and ministers who believed substantial donations would be made to their churches.  Businesses and individuals wired and mailed the advance fees to multiple bank accounts controlled by the Johnsons in different states.  Yvette Johnson opened bank accounts and conducted financial transactions using proceeds obtained from the Johnsons’ business activities.

The Johnsons spent the $3.7 million in advance fees from individuals and businesses to support their lifestyle, which the indictment alleges included: the purchase of Bentley, Mercedes Benz and BMW automobiles; the leasing of a residence in California for $18,000 a month; travel on private jets; and the funding of the mortgage on their Laytonsville residence.  Shannon Johnson admitted that he obtained $3.7 million by victimizing at least 11 individuals and businesses.

The Johnsons also evaded taxes on millions of dollars in income they earned from the advance fee scheme.  They admitted that they filed individual tax returns for tax years 1998 through 2001 using false Forms W-2 to fraudulently generate refund claims, evaded the payment of their 2002 through 2006 corporate and individual taxes totaling $98,220, and evaded the assessment of their 2007 through 2009 taxes.  The Johnsons attempted to conceal their income and assets from the IRS by selling assets in their own names, titling assets in the names of nominees, using multiple bank accounts across three states to disperse and conceal income, using nominees and fraudulent taxpayer identification numbers to open and maintain bank accounts, and using multiple business names to conduct business.

Acting Assistant Attorney General Ciraolo and U.S. Attorney Rosenstein commended the special agents of IRS-Criminal Investigation and the FBI, who investigated the case, and Assistant Chief John N. Kane of the Tax Division and Assistant U.S. Attorney Thomas Sullivan of the District of Maryland, who prosecuted the case.

Press Release Number: 
Updated May 18, 2016