Tax Preparer Admits Role In Fraud Scheme
POSTED: 7:01 pm PST March 8, 2010
UPDATED: 7:41 pm PST March 8, 2010
SAN DIEGO -- A Chula Vista tax preparer went before a judge Monday and admitted a scheme to defraud his clients out of more than $1 million.David Canales, 53, who operated a tax preparation and bookkeeping business, pleaded guilty to mail fraud and tax evasion charges.He is scheduled to be sentenced May 24 by U.S. District Judge Thomas Whelan.Canales admitted that he controlled two bank accounts in the fictitious business names "International Recovery Systems/IRS" and "Freight Transport Brokers/FTB."According to his plea agreement, he falsely represented to his clients that they owed substantial tax amounts to the Internal Revenue Service and California Franchise Tax Board and directed them to write checks to "IRS" and "FTB."But instead of forwarding the checks and the tax returns to the IRS and FTB, he deposited them into his own "IRS" and "FTB" bank accounts and either did not submit the clients' returns to the relevant taxing authority or submitted different returns showing little or no tax due, according to prosecutors.The defendant also admitted willfully evading payment of income taxes of $457,653 he earned for the tax years 2003-2007, according to court documents.
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