Tax Preparer Sentenced in SYAM Tax Service Scheme
BEAUMONT, Texas – A 40-year-old Dallas tax preparer has been sentenced to prison for federal tax violations and failure to appear for his trial on that charge in early 2015 in the Eastern District of Texas, announced U.S. Attorney Joseph D. Brown today.
Shannon Tecoko Mays was sentenced by U.S. District Judge Thad Heartfield to 180 months in federal prison, of which 162 months was for the tax scheme and an additional or consecutive 18 months for the failure to appear felony. Mays was also ordered to pay restitution of $1,121,202 to the Internal Revenue Service.
Mays was originally indicted in February 2014 by a federal grand jury charging him with conspiracy to commit wire fraud. He was released on bond pending trial and failed to appear for trial in January 2015. Mays was indicted by a federal grand jury in February 2015 for obstruction of justice for his failure to appear for trial. Mays pleaded guilty to the two felony indictments on Oct. 2, 2017.
According to prosecutors, an investigation began in August 2012 in response to numerous complaints to state and federal authorities from citizens in Port Arthur, Anahuac, Nacogdoches and Lufkin, Texas regarding income tax returns that were being fraudulently prepared on their behalf. During the investigation, it was discovered that Mays was operating numerous offices across the United States under the name “Syam Tax Services, L.L.C.” and “Baby Momma Tax.” Although the principal office was located in Dallas, Mays also operated or sought to operate satellite offices in numerous other locations, including Fort Worth, Houston, New Orleans, Memphis, Atlanta, Chicago and Los Angeles.
According to information presented in court, Mays targeted individuals who were on disability or only received Social Security income as they are generally exempt from having to file income tax returns and thus would be less likely to discover a fraudulent tax return had been filed on their behalf. To further facilitate the scheme, Mays employed “recruiters,” paying them from $50-100 for every client they successfully brought into Syam Tax. Many of the complaining taxpayers were told by the recruiters that they were receiving an economic “stimulus” payment from the government. In order to avoid detection, Mays altered the taxpayers’ addresses and phone numbers on the returns so that any phone calls or correspondence from the IRS would not reach the taxpayers. The scheme also used electronic deposits to ensure paper checks would not be mailed to the taxpayer. For the tax year 2011, Mays filed 4,226 tax returns claiming approximately $6 million in refunds. Of the returns filed, 3,887 of the returns fraudulently claimed an education credit under the American Education Opportunity Act, designed for persons to pay for their college education. Some of the returns also claimed false Earned Income credits. A successful injunction suit brought by the Texas Attorney General’s Office – Consumer Protection Division in 2014 recovered approximately $1,282,000 from Syam Tax Service bank accounts, which was returned to the U.S. Treasury. One recruiter from the Port Arthur area, Diana Broussard McCoy, pleaded guilty to the conspiracy charge in January 2015, and was sentenced to five years federal probation by Chief Judge Ron Clark. Another recruiter, Myra Jones, pleaded guilty in March 2014, to impersonating an Internal Revenue Service employee, and was also sentenced to federal probation by Judge Clark.
“The defendant who perpetrated this scheme systematically defrauded the government and the taxpaying public,” said Tamera Cantu, IRS Special Agent in Charge of the Dallas Field Office. “At the IRS, protecting taxpayer money is a matter we take very seriously. IRS Criminal Investigation will continue to vigorously pursue those who unjustly enrich themselves by preparing false claims for refunds.”
This case was investigated by Internal Revenue Service – Criminal Investigation Division, Federal Bureau of Investigation, the Port Arthur Police Department, the Texas Attorney General’s Office – Consumer Protection Division, and the Treasury Inspector General for Tax Administration. This case was prosecuted by Assistant U.S. Attorneys Robert L. Rawls and Chris Tortorice.