An Augusta man whose tax preparation business generated more than $1 million in fraudulent tax refunds has pleaded guilty to wire fraud conspiracy.
Allen Brown, 41, faces up to 20 years imprisonment, a period of supervised release, restitution and monetary penalties, said Tara M. Lyons, acting U.S. attorney for the southern district of Georgia.
Brown’s plea agreement states he and several other individuals operated a “ghost” tax preparation business at 1850 Gordon Hwy. Suite C, as well as at a church and at his home. According to property records, Brown owns the property at 1850 1/2 Gordon Hwy.
Brown operated as a “ghost” preparer because he did not identify himself as a preparer on clients’ tax forms. On those forms, he fabricated income to qualify clients for tax credits, claimed fake deductions to boost the size of refunds and charged fees based on a percentage of the refunds, the agreement said.
Brown and other providers who worked with him falsified 63 federal income tax returns, causing the U.S. Treasury to issue $1,003,631 in false tax refunds, it said. Brown required clients to pay him a fee of 10% per refund.
During preparation, Brown offered a “standard” option and an “I’m not scared” option. The standard option generally resulted in a fraudulent refund of $2,000-$9,000. For these returns, Brown instructed preparers to falsely claim sick and family leave credits and other false items, it said.
The “I’m not scared” option resulted in a refund of $14,000-$30,000. For these returns, Brown instructed his ghost preparers to falsely claim fuel tax credits, falsely report gross income and expenses on Schedule C and medical and dental expenses on Schedule A with the returns.
The case is being investigated by the Internal Revenue Service and prosecuted by Assistant U.S. Attorney George J.C. Jacobs, III.
