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Justice News

Department of Justice
U.S. Attorney’s Office
Southern District of New York

FOR IMMEDIATE RELEASE
Wednesday, July 18, 2018

Tax Preparer Arrested For Fraudulent Scheme To Steal Over $1 Million From His Clients

Geoffrey S. Berman, the United States Attorney for the Southern District of New York, James D. Robnett, the Special Agent-in-Charge of the New York Field Office of the Internal Revenue Service, Criminal Investigation (“IRS-CI”), and Nonie Manion, Acting Commissioner of the New York State Department of Taxation and Finance (“NYSDTF”), announced today the arrest of TOM SHIN on charges of aiding the preparation of a false tax return and wire fraud.  The Complaint charges that SHIN, a tax preparer in New York, participated in a scheme to obtain over $1.3 million of his clients’ money that was intended to be paid to the IRS and NYSDTF for taxes the clients owed.  SHIN was arrested this morning and will be presented today in Manhattan federal court before U.S. Magistrate Judge Debra Freeman.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, the defendant betrayed his clients’ trust and engaged in a brazen scheme to defraud his clients of more than $1.3 million that was intended to be used to pay taxes owed to the federal and state governments.  Thanks to the investigative work of the IRS and the NYSDTF, the defendant will be prosecuted for his actions.”

IRS-CI Special Agent-in-Charge James D. Robnett said:  “The IRS enforces the nation’s tax laws, but also takes particular interest in cases where someone, for their own personal gain, allegedly takes what belongs to others.  Our special agents are uniquely qualified to assist state and federal law enforcement agencies with these types of investigations by following the money.”

NYSDTF Acting Commissioner Nonie Manion said:  “The blatant deceit and theft allegedly carried out by this tax preparer is unconscionable. The honesty and integrity New Yorkers expect from their tax preparer must never be compromised, which is why we’ll continue to work with all levels of law enforcement to root out unscrupulous preparers and hold them accountable.” 

According to the allegations in the Complaint unsealed today[1]:

SHIN was hired to prepare joint federal and state tax returns for two individuals (the “Clients”) for tax year 2017.  SHIN showed the Clients completed tax return forms indicating that the Clients owed approximately $1.3 million in taxes.  However, SHIN actually filed false returns on behalf of the Clients without their knowledge, which concealed the Clients’ tax liability.  SHIN then, in connection with applications for extensions of time to file his personal tax returns, directed tax authorities to withdraw approximately $1.3 million from the Clients’ bank account, and then filed personal tax returns seeking an approximately $1.3 million refund.  The net result of the alleged scheme would have been a transfer of approximately $1.3 million from the Clients’ bank account to SHIN.

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SHIN, 36, of Staten Island, New York, is charged with one count of aiding the preparation of a false tax return, which carries a maximum penalty of three years in prison, and one count of wire fraud, which carries a maximum penalty of 20 years in prison.  The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

This case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorney Brett M. Kalikow is in charge of the prosecution.

The charges contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

 

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint forth herein constitute only allegations, and every fact described should be treated as an allegation.

 

Topic(s): 
Financial Fraud
Tax
Press Release Number: 
18-248
Updated July 18, 2018