Three Colorado Springs Residents Convicted Of Conspiracy To Defraud The IRS And Related Tax Charges Following Jury Trial
DENVER – George Brokaw, age 68, John Pawelski, age 66, and Mimi Vigil, age 63, all from Colorado Springs, Colorado, were found guilty today of conspiracy to defraud the IRS and related tax charges, following a 4-day jury trial before U.S. District Court Judge Christine M. Arguello. The jury deliberated for an hour and a half before reaching their verdicts. Brokaw, Pawelski and Vigil are scheduled to be sentenced by Judge Arguello on January 25, 2015. Following the guilty verdicts the three defendants, who were free on bond, were taken to U.S. Magistrate Judge Kathleen M. Tafoya’s courtroom for a detention hearing. Magistrate Judge Tafoya changed the conditions of their bond to include GPS monitoring confined to Colorado Springs as well as a curfew from 9:00 p.m. to 6:00 a.m.
All three defendants were indicted by a federal grand jury in Denver on May 22, 2013, which was followed by a superseding indictment on October 21, 2013. According to the superseding indictment, and evidence presented at trial, beginning in October 2008, and continuing through May 2009, Brokaw, Pawelski, Vigil, and others conspired with each other to defraud the United States by submitting false claims for income tax refunds to the Internal Revenue Service.
The three filed or caused to be filed false, fictitious and fraudulent Form 1040 tax returns containing false claims for refunds in their names. A total of twelve fraudulent returns were filed attempting to receive over twenty-four million dollars in fraudulent refunds. In connection with these false tax returns they submitted or caused to be submitted false Forms 1099-OID. The 1099-OID forms falsely reported that financial institutions, lenders, or other entities had withheld and paid over to the IRS interest income from accounts which did not generate such interest income and from which no such withholdings were made. The Form 1040 tax returns claimed false refunds based on these false claims of withholdings.
Furthermore, from March 2008 and continuing through April 2012, the defendants willfully conspired with each other to obstruct and impede the due administration of the Internal Revenue laws by attempting to thwart the legitimate collection of taxes owed to the IRS by them and others. They caused to be filed or submitted to the IRS a variety of false, fraudulent, or illegitimate documents which purported to constitute payments of taxes owed to the IRS as well as purported electronic funds transfer (EFT) drawn on closed bank accounts. In addition, the defendants filed a variety of false and fraudulent liens or other documents which falsely claimed that IRS employees, who were engaged in legitimate tax collection efforts against one or more of the defendants, owed one or more of the defendants amounts of money ranging from tens of millions of dollars to billions of dollars.
All three defendants face statutory maximum sentences ranging from not more than 3 years to not more than 10 years, plus up to a $250,000 fine, per count of conviction.
“Defendants sought to hide their disregard for the Constitution and our system of laws behind an inky cloud of fraudulent and sometimes farcical ‘legal’ claims,” said U.S. Attorney John Walsh. “The jury, after hearing all the evidence and argument, saw through Defendants’ continuing scheme and convicted them of fraudulently attempting to obtain millions of dollars from the United States.”
“This verdict of guilty on all counts sends a clear message when you participate in a fraudulent tax scheme attempting to receive millions of dollars in fraudulent refunds, you will be found guilty,” said Stephen Boyd, Special Agent in Charge for IRS Criminal Investigation, Denver Field Office. “On the front end, IRS did an outstanding job safeguarding U.S. tax dollars by preventing any fraudulent refunds from being issued to these individuals.”
“We are happy that the jury held the defendants accountable for their repeated efforts to interfere with and harass legitimate tax collection efforts by hard working IRS employees,” said Preston Lamb, Special Agent in Charge of the Treasury Inspector General for Tax Administration (TIGTA).
This case was investigated by Internal Revenue Service – Criminal Investigation (IRS CI), and Treasury Inspector General for Tax Administration (TIGTA). The case is being prosecuted by Assistant U.S. Attorneys Mathew Kirsch and Martha Paluch.