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Press Release

Lanett Woman Receives 46-Month Sentence for Preparing Fraudulent Federal Income Tax Returns

For Immediate Release
U.S. Attorney's Office, Middle District of Alabama

            Montgomery, Alabama On Thursday, January 9, 2020, a Lanett, Alabama resident, Gladys Rosalynn McCauley, 43, received a 46-month sentence for aiding and assisting in the filing of false federal income tax returns, announced United States Attorney Louis V. Franklin, Sr. and Thomas J. Holloman III, Special Agent in Charge of the Atlanta Field Office of IRS, Criminal Investigation. 

            According to court documents, McCauley owned an income tax preparation business in Lanett called “Roz House of Tax” that she opened in 2014.  McCauley’s business collected fees as a percentage of the tax refunds she claimed for her customers.  In order to inflate those refunds, McCauley knowingly placed false items in her customers’ income tax returns.  For example, McCauley falsely claimed that customers were entitled to education tax credits and child tax credits—even though she knew they were entitled to no such credits.  In yet another example, she falsely claimed a client had more than $34,000 in business losses.  Over the course of a few years, McCauley’s numerous false claims resulted in a tax loss to the Internal Revenue Service (IRS) of more than $1.5 million. 

            At the sentencing hearing, United States District Judge R. Austin Huffaker, Jr. described McCauley’s offense as a “serious” one, noting that she hurt all citizens who pay their taxes. 

            “For far too long, opportunistic tax return preparers like Ms. McCauley have preyed upon the unwitting taxpayers residing in this district,” stated United States Attorney Franklin.  “As was the case here, preparers attempt to make money by putting false information on the tax returns of others.  In doing so, the preparers subject their customers to possible future scrutiny by the IRS and they pocket money that should have gone to the public’s benefit.  This conduct must stop.  Hopefully, Ms. McCauley’s sentence will cause other tax return preparers who have considered running schemes like this to honestly and accurately prepare tax returns.” 

            "As tax filing season is underway, those who might consider preparing false tax returns should be aware of the extremely negative consequences as evidenced yesterday," said Special Agent in Charge Holloman.  "The sentencing of Gladys McCauley again emphasizes that the Internal Revenue Service and U.S. Attorney’s office will continue their aggressive pursuit of those who would attempt to defraud America's tax system.  In addition, taxpayers are encouraged to visit the IRS.gov website for tips on looking for a reputable return preparer and their filing responsibility.” 

            The IRS’s Criminal Investigation Division investigated this case.  Assistant United States Attorney Jonathan S. Ross prosecuted the case. 

Updated February 10, 2020

Topic
Tax