Chicago Resident Indicted for Using Stolen Identities to File False Tax Returns
A Chicago man was indicted by a grand jury sitting in the Northern District of Illinois for using stolen identities to file false federal income tax returns, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division and U.S. Attorney Zachary T. Fardon of the Northern District of Illinois.
Carlos L. Smith was arraigned earlier today on a 34-count indictment. He was charged with 14 counts of wire fraud, nine counts of theft of government funds, six counts of aggravated identity theft and five counts of filing false income tax returns. According to the allegations in the indictment, beginning in February 2013 and continuing through April 15, 2015, Smith operated CLS Financial Services, a company that assisted with credit repair, business consulting and tax return preparation. Smith used individuals’ names and social security numbers to prepare false tax returns that each claimed thousands of dollars in tax refunds. The U.S. Treasury refund checks were mailed to addresses linked to Smith or directly deposited into bank accounts that Smith controlled. Smith also filed fraudulent tax returns in his own name. In total, Smith prepared false tax returns that claimed refunds of more than $400,000.
If convicted, Smith faces a statutory maximum sentence of 20 years in prison for each wire fraud count, a statutory maximum sentence of 10 years in prison for each theft of government funds count, a mandatory minimum sentence of two years in prison for aggravated identity theft, and a statutory maximum sentence of three years in prison for each count of filing false income tax returns. Smith also faces potential financial penalties, including fines and restitution.
Acting Assistant Attorney General Ciraolo and U.S. Attorney Fardon commended special agents of IRS-Criminal Investigation and the U.S. Postal Inspection Service, who investigated the case, and Trial Attorneys Sonia M. Owens, John T. Mulcahy and Ryan R. Raybould of the Tax Division, who are prosecuting the case. Ciraolo also thanked the U.S. Attorney’s Office in Chicago for their substantial assistance.