Five Sentenced in Tax Fraud Scheme
PENSACOLA, FLORIDA – John David Castleberry, 64, and Teresa Haggerty, 61, both formerly of Pensacola Beach, Florida, Mark Douglas Stokes, 61, and Melinda K. Stokes, 60, of Colleyville, Texas, and Christopher Stephen Baum, 57, of Arlington, Texas, were sentenced to federal prison yesterday by Senior United States District Judge Roger Vinson for conspiring to commit tax fraud. The sentences were announced by Pamela C. Marsh, United States Attorney for the Northern District of Florida.
The defendants were convicted on January 22, 2015, at the conclusion of a 12-day jury trial. In addition to conspiracy, Castleberry and Haggerty were also convicted for assisting in the preparation and filing of fraudulent tax returns, and Castleberry was convicted for filing his own false federal income tax return.
At trial, the government presented evidence that between 2008 and 2010, the defendants participated in a scheme to prepare and file fraudulent tax returns seeking more than $9 million in refunds. The group used an obscure IRS Form 1099-OID to falsely report that they and/or their clients’ creditors had withheld large amounts of federal income taxes and had paid this money over to the IRS. As a result of the fraudulently-overstated income tax withholding, the tax returns that were filed on behalf of the defendants and/or their clients claimed large refunds to which the defendants and their clients were not entitled.
The defendants were sentenced as follows:
- Castleberry: 126 months in prison and $328,143.90 in restitution to the IRS;
- Haggerty: 18 months in prison and $129,762.85 in restitution to the IRS;
- Mark Stokes: 24 months in prison and $162,608.23 in restitution to the IRS;
- Melinda Stokes: 12 months and 1 day in prison and $162,608.23 in restitution to the IRS; and
- Baum: 51 months in prison and $162,608.23 in restitution to the IRS.
United States Attorney Marsh said, “This week, millions of Americans submitted accurate and timely tax returns. The individuals who defraud the United States Treasury are also stealing from each honest American taxpayer.”
Special Agent in Charge James D. Robnett stated, “Tough sentences like the one handed down to John Castleberry should be a stark reminder to those out there contemplating theft of taxpayer dollars. Even lessor participants pay a heavy price for their participation in tax fraud schemes, and during a time when Americans are all paying their fair share of taxes, the mistakes of these individuals should be a lesson to us all.”
The case was investigated by the Internal Revenue Service – Criminal Investigation and the Treasury Inspector General for Tax Administration (TIGTA) Dallas Field Division. The case was prosecuted by Assistant United States Attorneys Randall J. Hensel and J. Ryan Love.
The United States Attorney's Office for the Northern District of Florida is one of 94 offices that serve as the nation’s principal litigators under the direction of the Attorney General. The office strives to protect and serve the citizens of the Northern District of Florida through the ethical, vigorous, and impartial enforcement of the laws of the United States, to defend the national security, to improve the safety and quality of life in our communities through the protection of civil rights, and to protect the public funds and financial assets of the United States. To access available public court documents online, please visit the U.S. District Court for the Northern District of Florida website. For more information about the United States Attorney’s Office, Northern District of Florida, visit http://www.justice.gov/usao/fln/index.html.