Posts Tagged ‘tax fraud’

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Islamic charity pleads guilty to tax fraud

August 17, 2014

Al Haramain, a Saudi-based international charity which once maintained its U.S. branch in Oregon, has pleaded guilty to tax fraud 14 years after filing a false return designed to conceal a $150,000 check issued to Chechen jihadists.

The Associated Press reported on July 29:

…On Tuesday, the charity pleaded guilty in U.S. District Court in Eugene to one count of filing a false tax return with the Internal Revenue Service. The group was placed on probation for three years, and it agreed during that time not to resume operating as a tax-exempt charity in the U.S., prosecutors said.

The charity failed to report to the Internal Revenue Service that a $150,000 donation in 2000 went overseas to Saudi Arabia and was meant to be sent to Chechnya, prosecutors said. The charity falsely reported on its tax return that the money was used partly to buy a building in the U.S.

The foundation was disbanded after the U.S. government declared it was a terrorist organization and froze its assets…

Far from being a lawless series of raids in the early- to mid-2000s against innocent Islamic charities that CAIR and the ACLU have depicted, the successful convictions against the Holy Land Foundation and guilty pleas such a this illustrate that the Bush-era crackdowns on front charities was legitimate.

As part of the plea deal, Al Haramain’s former U.S. director, Pete Seda, who was previously convicted for his involvement in the case, is getting charges dropped against him.

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Second “Muhammad” woman pleads guilty to filing fraudulent tax returns

August 10, 2011

Two tax preparers have pleaded guilty within the past 40 days to filing false tax returns.  The schemes of both women involved trickery to obtain the earned income tax credit for their clients.

First we had Sonya Muhammad of Calhoun, Louisiana.  From a Department of Justice press release:

TAX PREPARER  PLEADS GUILTY TO FILING FALSE CLAIMS FOR TAX REFUNDS

SHREVEPORT, La. – United States Attorney Stephanie A.  Finley announced today that Sonya L. Muhammad, 32, of Calhoun, La., pleaded guilty to filing false claims for federal income tax refunds. Muhammad was indicted by a federal grand jury in December 2010 on 31 counts of aiding and assisting in making false returns and 1 count of structuring. In May 2011, a superceding indictment was returned adding six more counts of filing false returns.

Muhammad owns and operates a tax return preparation business in West Monroe. At the change of plea hearing yesterday, Muhammad admitted to preparing and filing tax returns at her business knowing that the returns  contained material false claims. Between 2003 and 2007, she prepared and filed at least 31 tax returns that were materially false with regard to items such as dependants and wages in a scheme to inflate the Earned Income Tax Credit that the taxpayer would receive from the IRS. In 2011, while out on bond for these offenses, Muhammad filed six more materially false tax returns. Due to this conduct, Muhammad’s bond was revoked.

Muhammad pleaded guilty to two counts of aiding and assisting in making a false return. She faces a maximum penalty of three years in prison or a fine of $250,000, or both, for each count. She will be sentenced by U. S. District Judge James on October 3, 2011.

Next up we have Jennifer Marie Muhammad of Springfield, Illinois.  From the State Journal-Register on Aug. 3:

Springfield woman pleads guilty in tax fraud  scheme

A Springfield woman has pleaded guilty in federal court to participating in a fraud scheme that claimed more than $1 million in false tax refunds over a three-year period.

Jennifer Marie Muhammad, also known as Jennifer Powers, 42, waived indictment and Tuesday pleaded guilty to one count each of conspiracy to commit fraud and aiding and assisting in the preparation of false and fraudulent tax returns.

During court proceedings and in court documents, Muhammad admitted that in 2005 she became involved in the conspiracy with her now-deceased stepfather. She admitted that she recruited individuals whose name and social security number were used to prepare 5 to 10 tax returns which falsely claimed earned income credit.

Generally, the earned income credit is available to low-income wage-earning or self-employed taxpayers to reduce the amount of tax due. However, if the amount of the credit exceeded the tax due, the taxpayer received the excess as a refund.

According to U.S. District Court documents, approximately 435 returns were filed and more than $800,000 in refunds were issued by the Internal Revenue Service between March 2005 and April 2008 as a result of the scheme.

Sentencing for Muhammad is scheduled for Dec. 5 before U.S. District Judge Richard Mills. The statutory penalty for conspiracy to commit fraud is up to five years in prison and a fine of up to $250,000; for aiding and assisting in the preparation of false tax returns, the penalty is up to three years in prison and a fine of up to $100,000.

The defendant may also be ordered to pay restitution.

The guilty pleas follow the June sentencing of Baltimore man Tyrone Robert Campbell, also known as “Mr. Muhammad,”and “Muhammad Shahid,” to five years in federal prison for filing 600 fraudulent tax returns and commiting aggravated identity theft.