Defendant Agrees Never Again to Prepare Professional Tax Returns
SAN JOSE – LAWFUEL – Press Release Service – United States Attorney Kevin V. Ryan and IRS-Criminal Investigation Special Agent in Charge Roger Wirth announced that San Jose tax preparer MELINDA NEWENS pleaded guilty today to one count of aiding and assisting in the preparation of false tax returns. The plea was entered before U.S. District Judge Ronald M. Whyte,.
According to the plea agreement, Ms. Newens, 53, owned and operated two franchises under Jackson Hewitt Tax Service, Inc., in San Jose. In pleading guilty to the information filed on April 18, 2006, Newens admitted the following:
Beginning in the 1999 tax year, and continuing through the 2003 tax year, Ms. Newens included fraudulent deductions in the tax returns she prepared for certain clients who filed their taxes electronically. She admitted that she engaged in this fraudulent practice for three reasons: first, by adding deductions that resulted in the filing of additional schedules and forms on her clients’ returns, she was able to increase her fee for preparing the return; second, her fee was generally paid from the tax refunds her clients received; third, she wanted to make her clients happy, and retain their business, by increasing the size of their tax refunds.
According to IRS Criminal Investigation Special Agent in Charge Roger L. Wirth, “People who commit tax fraud will be held accountable for their crimes. We will continue to investigate and recommend prosecution against return preparers who knowingly prepare false tax returns on behalf of others.”
Newens acknowledged that she included fraudulent deductions in her clients’ returns without their knowledge or consent. Newens further admitted that as a result of her fraud, the Internal Revenue Service conducted correspondence audits of approximately 400 of her clients and that the tax loss to the federal government identified by those audits was over $1 million. In pleading guilty, Newens also agreed to sell or transfer her interest in the two Jackson Hewitt franchises she owns, and further agreed that she will never again prepare tax returns professionally or supervise any other person in the professional preparation of individual, partnership, or corporate tax returns.
The maximum statutory penalty for aiding and assisting in the preparation of a false tax return in violation of 26 U.S.C. § 7206(2) is three years imprisonment and a fine of $100,000. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Defendant Newens is scheduled to be sentenced on December 4, 2006. David Callaway is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Tracey Andersen. These charges are the result of an investigation by IRS-Criminal Investigation.
A copy of this press release may be found on the U.S. Attorney’s Office’s website at www.usdoj.gov/usao/can.
Electronic court filings and further procedural and docket information are available at https://ecf.cand.uscourts.gov/cgi-bin/login.plhttps://ecf.cand.uscourts.gov/.
Judges’ calendars with schedules for upcoming court hearings can be viewed on the court’s website at www.cand.uscourts.gov.
All press inquiries to the U.S. Attorney’s Office should be directed to Luke Macaulay at (415) 436-6757 or by email at [email protected]List your legal jobs on the LawFuel Network