People Reminded Of Stiff Penalties For Violation Tax Laws As Filing Deadline Approaches

Several Ohioans have been found guilty and sentenced to prison for violating federal tax laws over the past few months, said Steven M. Dettelbach, United States Attorney for the Northern District of Ohio, said Kathy Enstrom, Special Agent in Charge of IRS Criminal Investigation’s Cincinnati Field Office.

As the 2014 tax filing deadline approaches, these cases serve as reminders that there are civil and sometimes criminal penalties to filing erroneous tax returns.

“Tax day is not fun, but the vast majority of Americans who properly report and pay their fair share need to know that we will aggressively prosecute those who shirk or flaunt their obligations,” Dettelbach said.

“IRS Criminal Investigation takes violations of the tax law very seriously,” Enstrom said. “The investigative work done by Criminal Investigation is a part of an aggressive effort by the IRS to combat tax fraud on all fronts. With the April 15 tax deadline upon us, it is important for people to have confidence that when they pay their taxes, their neighbors, friends and co-workers are doing the same.”

Details on a few cases over the past year:

United States v. Gooch and Scott: Don P. Gooch and Gerard F. Scott, self-proclaimed “citizens of the world,” found guilty of conspiring to defraud the Internal Revenue Service out of more than $8 million. Gooch, 64, of East Cleveland, was sentenced to eight years in prison while Scott, 38, was sentenced to 10 years in prison .

In early 2011, Scott obtained a tax identification number for a purported trust (the Gerard Frank Scott Trust) and filed false Forms 1099-INT with the IRS stating that the trust had paid millions of dollars of interest income to Gooch, a woman identified at trial as Scott’s wife, and two other trusts purportedly set up by Scott and Gooch, from which a total of $17 million of taxes had purportedly been withheld. Based on those false 1099 forms, the conspirators caused false income tax returns to be filed for Gooch and Scott’s wife, and the two other trusts claiming false income tax refunds totaling approximately $8,033,930, according to court documents.

United States v. Mace: Brandon Mace, 35, of Canton was sentenced to more than six years in prison for claiming false income tax refunds totaling nearly $5.5 million. Mace filed the false claims while incarcerated on state charges. Mace pleaded guilty to two counts stating that he prepared and filed false income tax returns for the years 2008 and 2009 claiming false tax refunds in the amounts of $207,000 and $5,292,000, respectively.

United States v. Hall: A former Toledo medical doctor was sentenced to five years in prison after previously pleading guilty to crimes related to the dispensation of 1,300 pills of Oxycodone and fraudulently billing Medicaid for more than $78,000. Darrell A. Hall, 54, pleaded guilty to conspiracy to distribute a controlled substance, health care fraud and a tax count. He failed to pay $97,384.88 in taxes that he owed to the Internal Revenue Service owed on behalf of EDM Health Services, LLC, between 2007 and 2010, according to court records.