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Thursday, May 7, 2015

Detroit Residents Sentenced for Defrauding Internal Revenue Service With Identities of Deceased Individuals

Two Detroit residents were sentenced after pleading guilty to charges of wire fraud and aiding and abetting in the use of false identification, Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division, U.S. Attorney Barbara L. McQuade of the Eastern District of Michigan and Special Agent in Charge Jarod Koopman of Internal Revenue Service-Criminal Investigation (IRS-CI) announced today.

McAllen Knight and Renita Adams were each sentenced to serve 18 months in prison by U.S. District Court Judge Avern Cohn of the Eastern District of Michigan.  Knight’s mother, sister and stepfather also pleaded guilty to wire fraud and aiding and abetting in the use of false identification.  Brenda Knight, Knight’s mother, and Adreann Turnage, Knight’s sister, were sentenced on April 14 to serve 24 and 18 months in prison, respectively.  Willie Watkins, Knight’s stepfather, was sentenced on April 29, 2014, to serve 30 months in prison.  All five defendants were ordered to pay $410,949 in restitution.   

According to court records, Adams and McAllen Knight participated in a scheme with Watkins, Brenda Knight and Adreann Turnage to defraud the United States by using the names and social security numbers of recently deceased individuals to prepare fraudulent tax returns.  They filed hundreds of fraudulent 2010 tax returns.  The returns sought refunds by making false claims for the Earned Income Credit, Education Credits and the Making Work Pay Credit.  The returns were transmitted electronically, utilizing public access Internet connections from local hotels and coffee shops.  An Internet account registered to Adams was used to transmit 306 fraudulent returns.  The refunds were directed to bank accounts that were established for the sole purpose of receiving the fraudulent refunds.  McAllen Knight caused some of these bank accounts to be opened by others to receive the deposits of the false tax refunds.  Adams helped distribute the proceeds of the fraudulently obtained tax refunds at the direction of her fellow participants and retained a portion of the proceeds for her own benefit.

The investigation of this case was conducted by special agents of IRS-CI and prosecuted by Assistant U.S. Attorney Ross I. MacKenzie of the Eastern District of Michigan and Trial Attorney Kenneth Vert of the Tax Division.

Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

Press Release Number: 
Updated May 8, 2015