With Recent Pleas, 53 Linked to Massive Scheme have been Convicted
SANTA ANA, California – A licensed tax return preparer has pleaded guilty to filing more than $41 million worth of false claims against the United States, making her the 53rd and final defendant linked to the quarter billion dollar “Old Quest” tax refund scheme to be convicted.
Alma M. Wilbur, 40, of Victorville, pleaded guilty Friday afternoon to one count of making a false claim against the United States. Wilbur admitted that in May 2009 she filing a false federal tax return in her name that sought a refund of $281,146. When she pleaded guilty before United States District Judge Josephine L. Staton, Wilbur also admitted that she prepared more than 70 false tax returns that fraudulently claimed more than $41 million in bogus tax refunds.
The scheme run out of the Fontana-based Old Quest Foundation was the largest tax refund fraud in history involving misuse of Original Issue Discount tax forms. The case against Wilbur and the other Old Quest defendants stems from Operation “Stolen Treasures,” an investigation conducted by Special Agents with IRS – Criminal Investigation that led to 55 people being indicted by a federal grand jury in the fall of 2011.
Old Quest and a related business – the Rancho Cucamonga-based De la Fuente and Ramirez and Associates (DLFRA) – prepared and filed more than 400 false income tax returns that together claimed more than $250 million in fraudulent tax refunds.
During a search warrant executed at Old Quest’s offices, investigators seized several unfiled tax returns, including one signed tax return that falsely reported $10,500,106 in federal income tax had been withheld and fraudulently claimed a $6,868,675 tax refund. Although the IRS stopped most of the false refunds before they issued, several very large refunds were issued, including one for $1,192,653.
With Wilbur’s guilty plea, all of the defendants have been adjudicated with prosecutors securing 53 convictions, with nine defendants found guilty at trial and 44 pleading guilty. One defendant remains a fugitive, and one defendant was acquitted.
Last week, another licensed tax return preparer, who is an ordained minister, also pleaded guilty to preparing false tax returns. Eugene H. Marzette Sr., 71, of San Bernardino, pleaded guilty on Thursday to one count of making a false claim against the United States for preparing a false tax return for an Old Quest customer that claimed a refund of $1,152,024. The evidence shows that the IRS paid a $1 million refund to that Old Quest customer.
Also, last month, Jose Tavares Hernandez, 42, of Riverside, a Correctional Officer for the state of California, was convicted at trial of making false claims against the United States, based on false income tax returns that resulted in a $769,963 refund issued to him by the IRS.
As a result of these convictions, Marzette, Wilbur, and Tavares Hernandez each face a statutory maximum sentence of five years in federal prison when they are sentenced by Judge Staton. Tavares is scheduled to be sentenced on December 12; Marzette on January 9, 2015; and Wilbur on February 13, 2015.
Thus far, many of the other Old Quest schemers have been sentenced to lengthy terms of imprisonment, including:
- Old Quest CEO Arturo S. Ruiz, who was sentenced to 14 years in prison;
- Old Quest and DLFRA promoter Arturo Villarreal-Alba, who was sentenced to eight years in prison;
- DLFRA owner Osman Norales, who was sentenced to 87 months in prison;
- Old Quest promoters Ricardo Bonilla and Maribel Rincon, who were each sentenced to 33 months in prison;
- Old Quest tax preparer Adel Cotton, who was sentenced 27 months in prison; and
- Old Quest customers Fernando Tavares Hernandez and Christine Rincon, who were each sentenced to 15 months in prison.
This case is the product of an investigation by the Internal Revenue Service –Criminal Investigation.