Ex-owner of accounting firm gets 3 years for tax fraud
By: Freeman Klopott
Examiner Staff Writer
November 5, 2009
The former owner of an accounting firm with offices in the District, Maryland and Virginia will spend the next three years in prison after filing tax returns seeking more than $500,000 in fraudulent refunds for his clients.
According to the Internal Revenue Service, the clients of Henderson Joseph's Triad Business Services who could not back up the deductions on their tax returns have agreed to return the cash plus interest after the clients lost lawsuits filed in civil court.
Joseph directed employees at Triad's three offices in D.C., Baltimore and Richmond to inflate or fabricate the deductions in thousands of clients' individual tax returns, the 54-year-old admitted in his guilty plea. The falsified deductions were for charitable donations, job expenses and other items. False credits were also claimed for education and child care.
Joseph coordinated the scheme from his D.C. office from 2001 though May 2002, authorities said. During that time, he reviewed each of the tax returns Triad's accountants filed and then sent them to the IRS.
According to court documents, the managers of Triad's offices in Baltimore and Richmond told authorities that Joseph trained them how to inflate the deductions.
The scheme drove clients seeking high tax refunds to repeat their business with Triad, lining Joseph's pockets with cash from the booming business. Joseph has been ordered to pay a $50,000 fine. "Taxpayers are reminded to scrupulously review a tax return prepared by their tax return preparer and question any credit deduction which they did not, in fact, incur or for which they lack appropriate documentation," said Channing Phillips, acting U.S. attorney for the District's federal court. The manager of Triad's D.C. office, Marcelle Stephens, also pleaded guilty in the scheme and has been ordered to pay restitution of $107,000 to the government. Stephens was given two years probation and ordered to home detention with an electronic monitoring device for six months.More from Freeman Klopott
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