One Tax Preparer Pleads Guilty, Three Others Arraigned In Conspiracy To File False Income Tax Returns
TRENTON, N.J. – One employee of an Essex County, New Jersey, tax preparation business pleaded guilty and three others were arraigned in federal court for their roles in a false income tax return conspiracy that caused tax losses of over $900,000, U.S. Attorney Craig Carpenito announced today.
Rudolph Sanders, 41, of Newark, New Jersey, pleaded guilty today before U.S. District Judge Michael A. Shipp in Trenton federal court to an information charging him with one count of conspiracy to defraud the IRS from February 2011 through March 2013.
Joseph Kenny Batts, 49, of Elkridge, Maryland, Angelo K. Thompson, 38, of Reistertown, Maryland, and Tony V. Russell, 47, of Stone Mountain, Georgia, were arraigned before Judge Shipp on May 9, 2018. They are each charged by indictment with one count of conspiracy to defraud the IRS from February 2013 through February 2017. In addition, Batts is charged with five counts of aiding and assisting in the preparation of false federal income tax returns, Thompson is charged with two counts of aiding and assisting in the preparation of false federal income tax returns, and Russell is charged with one count of aiding and assisting in the preparation of false federal income tax returns.
In June 2017, Damien Askew, 39, of Union, New Jersey, pleaded guilty to his role in the scheme from 2011 to 2015 and awaits sentencing. All five defendants have been released on bail.
According to documents filed in this case and statements made in court:
From 2009 through April 2015, Batts and Askew co-owned Tax Pro’s, a tax return preparation and payroll business in Essex County where Sanders, Batts, Thompson, Russell, and Askew all prepared tax returns.
In order to boost their business, the defendants conspired to falsify their clients’ income tax returns for the purpose of generating refunds in amounts that their clients were not entitled to receive. For instance, Sanders, Batts, Thompson, Russell, and Askew fabricated or inflated their clients’ education credits, child care deductions, charitable contributions, unreimbursed employee expenses, and certain business losses.
Sanders and other members of the conspiracy also permitted Batts to use their identification numbers in order to conceal Batts’ identity as the actual tax return preparer, partly due to Batts’ prior tax fraud conviction.
After law enforcement executed a search warrant at Tax Pro’s in April 2015, Batts discontinued Tax Pro’s and opened Tax Solutions and Associates in Union, New Jersey, where Batts, Thompson, and Russell continued preparing false federal income tax returns.
By inflating the tax refunds through fraudulent means, Batts, Askew, Thompson, Russell, and Sanders caused a total tax loss to the United States of over $900,000.
The conspiracy charge carries a maximum potential penalty of five years in prison. The aiding and assisting in the preparation of a false return charge carries a maximum potential penalty of three years in prison. Both charges carry a $250,000 fine, or twice the gross gain or loss from the offense.
Sanders’ sentencing is scheduled for Aug. 14, 2018. The charges and allegations against Batts, Thompson, and Russell are merely accusations, and they are presumed innocent unless and until proven guilty.
U.S. Attorney Carpenito credited special agents of IRS-Criminal Investigation, under the direction of Acting Special Agent in Charge Bryant Jackson in Newark, with the investigation.
The government is represented by Assistant U.S. Attorneys Jihee G. Suh and Cari Fais of the U.S. Attorney’s Office Special Prosecutions Division in Newark.
Sanders: Carol Gillen Esq.
Batts: Fred Klepp Esq.
Russell: Anthony Simonetti Esq.
Thompson: Scott A. Krasny Esq.
Askew: David Glassman Esq.