Los Angeles, CA – LAWFUEL – IRS News, Law Jobs – Kenneth Steve John pleaded guilty yesterday afternoon before United States District Judge Audrey B. Collins to conspiracy to defraud the Government with respect to claims, embezzlement, and aggravated identity theft charges detailed in a plea agreement previously filed in United States District Court in Los Angeles.
According to information contained in the original indictment, beginning in January 2005 and continuing into March 2006, Kenneth John (a.k.a. Dennis Steve John, a.k.a. Robbin Michael Tucker) caused the preparation of federal income tax returns in the names of his aliases and in the names of identity theft victims on which John reported fictitious gambling winnings and withholding amounts. The gambling winnings John detailed on the false tax returns were purportedly from various horse racing tracks in the southern California area. Further, both John and his co-conspirators allegedly obtained identification in names other than their own to facilitate cashing the U.S. Treasury checks. At least one of the names they used in the scheme belongs to an unwitting victim while another name is that of a deceased person. Additionally, John and his co-conspirators caused monies to be moved through several bank accounts belonging to other individuals. Some of these individuals, through whose bank accounts money was moved, received fees for assisting with the scheme by cashing checks and moving funds.
In his plea agreement, John admits that he and a co-conspirator filed false income tax returns with the Internal Revenue Service, claiming fraudulent refunds of at least $449,084. Further, John admits that that he and a co-conspirator carried out their crimes by filing fraudulent Federal Income Tax Returns, Forms 1040, with the Internal Revenue Service, using fictitious names or the names of individuals whose identity they had stolen. Specifically, John detailed that one of the false tax returns filed in the scheme was in the name of an identity theft victim claiming that the person had received $322,561.00 in gambling winnings from the Del Mar Thoroughbred Club and that $80,640.00 was withheld from the winnings for federal income taxes. Further, the return John filed claimed that the identity theft victim was entitled to a tax refund in the amount of the alleged withholding.
John also admits in his plea agreement that, in May, 2005, he and a co-conspirator opened a Fidelity Investments account using the above-mentioned identity theft victim’s name, social security number, and California Driver’s license number. In June, 2005, John and his co-conspirator received a United States Treasury tax refund check, based upon the false tax return they had filed, in the amount of $79,055.68, which they deposited into the Fidelity Investments account that they controlled.
IRS – Criminal Investigation Special Agents previously arrested Kenneth Steve John on December 7, 2006 at his home in Stevenson Ranch and executed a search warrant there. Agents also executed a search warrant at the Tarzana residence of an unindicted co-conspirator, searching for evidence of the alleged crimes. The following week, the court ordered the seizure of funds believed to be tied directly to the negotiated tax refund checks which John and others are accused of obtaining illegally from the government. Kenneth John has been held without bail since his arrest.
The maximum sentence that John faces, as set forth in his plea agreement, includes up to 22 years imprisonment followed by a term of three years of supervised release and a fine of up to $750,000. John is scheduled to be sentenced on May 7, 2007 before Judge Collins.
This case is the result of an investigation conducted by Internal Revenue Service – Criminal Investigation with assistance from the California Department of Motor Vehicles.