Stratford Man Convicted Of Operating Tax Refund Scheme
Deirdre M. Daly, Acting United States Attorney for the District of Connecticut, today announced that a federal jury in Hartford has found BENJAMIN GREEN, III, 45, of Stratford, guilty of engaging in a corrupt tax refund scheme. The trial before U.S. District Judge Vanessa L. Bryant began on November 7 and the jury returned its verdict yesterday afternoon following a three-day trial before U.S. District Judge Vanessa L. Bryant.
According to the evidence presented during the trial, in March 2009, GREEN filed a federal Individual Income Tax Return for the 2008 tax year. On the return, GREEN asserted the fraudulent “Original Issue Discount” (“OID”) tax scheme, in which taxpayers falsely claim significant amounts of OID interest income and federal tax withholding on their federal tax returns. The object of the OID tax scheme is to obtain large tax refunds from the U.S. Treasury by fraudulently claiming significant federal tax withholdings that exceed the smaller amount of tax due on the falsely claimed income.
On his federal tax return, GREEN falsely claimed to have received $920,063 in taxable interest income, and to have $929,702 of federal income tax withholdings for the 2008 tax year. Based on this false information, GREEN claimed a refund from the IRS in the amount of $616,434, and the IRS erroneously issued a refund in that amount to GREEN. Shortly after receiving the refund, GREEN disbursed the majority of the fraudulently-obtained funds through wire-transfers, withdrawals and checks to third parties. He also used more than half of the refund to pay off his mortgage.
When the IRS tried to collect the refund, GREEN undertook a course of conduct to inhibit the IRS’s efforts to recover the money, including sending frivolous correspondence to the IRS, hiding real property in the name of a nominee entity to impede the IRS’s collection efforts, and falsely complaining that the IRS had commenced unauthorized collection and enforcement actions against him.
GREEN was convicted of one count of making a false claim against the United States, which carries a maximum term of imprisonment of five years, and one count of attempting to obstruct the due administration of the internal revenue laws, which carries a maximum term of imprisonment of three years.
Judge Bryant has scheduled sentencing for February 3, 2014.
This matter was investigated by the Internal Revenue Service – Criminal Investigation, and is being prosecuted by Trial Attorney Sean Beaty of the Justice Department’s Tax Division, and Assistant U.S. Attorney Susan Wines.
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