DOJ, IRS Break Up Alleged $30M Scam Involving Fictitious Methane Production
A federal judge in Beaumont, Texas, has permanently barred 12 people from promoting an alleged tax fraud scheme involving bogus income tax credits, the Justice Department announced Feb. 24. The 12 are among 32 defendants named in a civil injunction lawsuit who allegedly helped customers claim more than $30 million in bogus federal income tax credits designed for producers of fuel from non-conventional sources. The court order was signed by Judge Marcia A. Crone of the U.S. District Court for the Eastern District of Texas.
The government complaint in the case, originally filed in Florida, says the scheme involved claiming tax credits based on the purported recovery and sale of methane from landfills in Puerto Rico, Illinois, New York, Ohio and Connecticut. In fact, the complaint states, no methane was produced or sold, although some of the defendants allegedly created fictitious business records to falsely document the purported production and sales.
According to the court order, the 12 people barred are Silas Anderson of San Antonio, Texas; Ursa Bookman of Camden, Texas.; Joann Spooner of Port Author, Texas.; Carlos Metoyer, of Lake Charles, La.; Cleven Harper, Gloria Toren and Edward Trotty of Lufkin, Texas.; Jacqueline Levias and Jackie E. Mayfield of Orange, Texas; and Yusef A. Muhammed, Denise White and Craig D. Johnson of Beaumont, Texas. All consented to be enjoined without admitting wrongdoing.
The government suit alleges that George Calvert and Gregory Guido of Florida, who have been previously enjoined, concocted the scheme and promoted it through tax preparers who acted as subpromoters. The tax preparers allegedly sold interests in the fictitious methane production facilities to thousands of customers in at least 14 states across the country and prepared income tax returns for customers claiming tax credits based on the fictitious methane sales.
According to DOJ, a total of 23 of the 32 defendants have now been barred, including, in addition to those named above, David Berger of Studio City, Calif., and Elizabeth and Louis Powell of Carthage, Texas., as well as Robert Anderson of Bloomington, Ill. Anderson also pleaded guilty to conspiracy to defraud the United States and mail fraud in a related federal criminal case in June 2009. The injunction case is still pending against the remaining nine defendants.
John DiCicco, acting assistant Attorney General for DOJ's Tax Division, thanked Shana Starnes, DOJ's trial attorney who is handling the case, and Jean Lane, a revenue agent with the Internal Revenue Service's Small Business/Self-Employed Division, who conducted the investigation.