Three Florida men have pleaded guilty Tuesday to defrauding the government out of millions of dollars through a fraudulent tax refund scheme, according to the Department of Justice (DOJ).
Christopher Johnson of Orlando and Jasen Harvey of Tampa entered guilty pleas to conspiring to defraud the United States by promoting a tax fraud scheme known as the “Note Program.” Arthur Grimes, also from Florida, previously pleaded guilty on April 2 to obstructing the IRS in connection with the same scheme, according to a DOJ press release.
WASHINGTON, DC – APRIL 15: The Internal Revenue Service (IRS) building stands on April 15, 2019 in Washington, DC. April 15 is the deadline in the United States for residents to file their income tax returns. (Photo by Zach Gibson/Getty Images)
Johnson and Harvey orchestrated a scheme between 2015 and 2018 in which they filed tax returns falsely claiming large income tax withholdings to secure substantial refunds from the IRS. These fraudulent returns, prepared by Harvey and others, produced millions of dollars in requested refunds. In return for their services, the conspirators charged clients fees and took a portion of the illicit refunds, the press release said.
The scope of the scheme was extensive, with fraudulent refund claims totaling over $3 million. The IRS disbursed approximately $1.5 million before uncovering the fraud. Grimes, who played a key role, submitted four false tax returns prepared by Harvey. When the IRS sought to recover a refund issued to Grimes, he obstructed the investigation by providing false statements and documents to an IRS revenue officer and transferring the funds to a nominee bank account, the press release explained. (RELATED: Biden IRS Launches Audit Into Conservative Org That Helped Tank Nominees For Key Administration Posts)
Johnson received over $200,000 in 2016 and more than $100,000 in 2017 in fraudulent refunds. Both Johnson and Harvey now face up to five years in prison for their involvement in the conspiracy, with sentencing dates yet to be set, according to the press release. Grimes, who is scheduled for sentencing November 12, could receive up to three years in prison for obstructing the IRS.
In addition to potential prison sentences, all three men also face supervised release, restitution and financial penalties.
