Defendant Banned for Life from Working as a Tax Consultant
SAN JOSE – LAWFUEL – The Legal Newswire – United States Attorney Scott N. Schools announced that Jonathan Wendy was sentenced yesterday to a year and a day in prison for aiding or inducing another to file a false tax return. This sentence is the result of an investigation by the Internal Revenue Service – Criminal Investigation.
Mr. Wendy, 56, of Capitola, California, pleaded guilty on November 1, 2006 to one count of aiding or inducing another to file a false tax return, in violation of 26 U.S.C. § 7206(2). In the plea agreement, Mr. Wendy, who was a tax preparer in San Jose for over twenty years, admitted that on July 27, 1999, he prepared a federal income tax return for an individual referred to as F.F. for the 1998 tax year. Mr. Wendy admitted that he falsely listed F.F.’s taxable income as $94,347.000, when he knew the correct amount was approximately $104,929.00. Mr. Wendy admitted that he intentionally reduced F.F.’s tax liability by creating numerous false or grossly inflated deductions for investment interest, professional dues, employee business expenses and amortization expenses on Schedule A of the return, and false stock sales on Schedule D of the return.
In addition to the specific count to which he pleaded guilty, Mr. Wendy also admitted preparing seventeen other individual tax returns and falsely listing the taxable amount claimed on each return. As a result of Mr. Wendy’s conduct, the amount of tax owing to the government by those taxpayers was more than $70,000.00.
Mr. Wendy was indicted by a federal grand jury on April 6, 2005. He was charged with 18 counts of aiding or inducing another to file a false tax return, in violation of 26 U.S.C. § 7206(2) and four counts of willfully failing to file his own tax returns, in violation of 26 U.S.C. § 7203.
The sentence was handed down by U.S. District Court Judge Jeremy Fogel following a guilty plea to one count of a violation of 26 U.S.C. § 7206(2). Judge Fogel also sentenced the defendant to serve a one year period of supervised release following his release from prison. In addition, Judge Fogel imposed two special supervised release conditions that Mr. Wendy agreed to in the plea agreement: one is a lifetime ban on working as a tax consultant and the other is to file complete and accurate federal tax returns for the tax years 1998 through 2005. Mr. Wendy will begin serving the sentence on March 3, 2008.
Susan Knight is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Susan Kreider. The prosecution is the result of a one year investigation lead by Internal Revenue Service – Criminal Investigation Special Agent Cindy Niu.
