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Miami Tax Law Blog

Phone company owners face fraud charges in Florida

A federal program designed to help those in lower income households pay their phone bills as well as provide assistance for rural residents would ordinarily be considered a noble undertaking that provides an essential service to those in need. But recently, a Florida grand jury indicted three phone company owners who allegedly abused the system for personal profit.

The three defendants were charged with wire fraud, false claims, and money laundering for fraudulently obtaining over $32 million from the federal Lifeline program. Lifeline allows phone companies to offer discounted rates to the poor in exchange for reimbursement drawn from the Universal Service Fund, which is financed by the service charges paid by the companies’ regular subscribers.

Identity theft and tax fraud peak around tax filing day

How many times have you heard someone say they’ll use their tax refund to pay off debts or make a purchase? What if the tax refund never comes? That is too often the case as tax fraud schemes divert funds from taxpayers in Miami and throughout the country.  The schemes are so common that even U.S. Attorney General Eric Holder, the highest official in the country appointed to regulate tax fraud, has been a victim.

In a recent video message to the public, Holder warned taxpayers to be cautious when preparing and filing their tax returns. His message pointed out that theft of tax information is no longer considered a white collar crime. Many charges of tax fraud are now directed at preparers of tax returns who take taxpayers’ information and use it for their own purposes.  Other abusers of the system include identity brokers, who collect personal information and resell it to those who use it in fraudulent activities. According to Holder, even gangs are now perpetrators of identity theft.

25 Florida residents charged with tax fraud and identify theft

Federal authorities recently charged 25 South Florida people with criminal acts of identity theft and tax fraud.  The suspected offenders allegedly stole close to 14,000 identities to file fraudulent income tax-returns in their names. The IRS paid $9.5 million to the suspects as a result of the fraudulently filed returns. In the last two years, the U.S. attorney’s office has prosecuted hundreds of people accused of stealing nearly 90,000 identities in attempts to commit acts of tax fraud.

Identity theft and tax-refund fraud are rapidly becoming a widespread issue in and around Miami as well as across the country. More than 300 people have been prosecuted for their alleged role in tax fraud and have collected $106 million in fraudulent tax refunds. It is a serious problem for the IRS, as well as other government agencies, which appears to have no simple solution.

Drug sales proceeds link two auto businesses to money laundering

Cases of money laundering seem more prevalent in the news in Florida lately as criminal investigation efforts increase across the nation. Unfortunately, as these efforts increase, more and more people who have made honest mistakes may find themselves accused of intentional or willful criminal acts.

Two auto businesses were sentenced recently following the guilty pleas, which were entered by the company president for both businesses, to one count of conspiracy to launder monetary instruments. In addition to fines and probation, the businesses were ordered to surrender $1.3 million in profits obtained illegally, business property, buildings and vehicle inventory.

Suspected members of shoplifting ring face fraud charges

The average white collar defendant can be a business owner, corporate boss or ordinary individual. White collar crime often begins as something harmless: a little creative accounting here or some misplaced paperwork there. However, it can quickly escalate into something bigger than what was first anticipated by those involved. This can eventually lead to a person facing the threat of jail time and possibly losing their life’s work.

Recently, police brought down a statewide shoplifting ring worth millions of dollars. The crime syndicate was well organized. It allegedly included shoplifters, middlemen and a ringleader. The ring purportedly used the Internet and a family business to sell their stolen goods. Shoplifters were allegedly paid to systematically steal lots of small items from various chain stores. The syndicate is believed to have handled stolen goods worth around $15 million.

Florida contractor accused of theft, misappropriation of funds

DIY is a trend that is booming in this economy as individuals try to save money. Instead of selling their home and buying another, a lot of homeowners are choosing to remodel and update what they already have. Understanding that construction isn’t for everyone, a lot of homeowners just want a professional to handle the details.

When a homeowner hires a contractor, the contract that they sign is a civil agreement. Thus, when a dispute arises, it is most often an issue for civil court. What could cause a contract dispute to cross over into criminal court? Violation of certain state laws and regulations is one way that this could happen.

Prosecutors say former Hialeah mayor hid income

A man was recently investigated for allegedly running a jewelry-investment scam that federal documents say added up to $45 million. The man eventually pleaded guilty to the crimes alleged. CBS4 reported that in order to reduce the 10-year prison term that he was facing, the man agreed to cooperate with federal prosecutors in a related case.

This related case involved several loans that a former Hialeah mayor made to the individual mentioned above. The man claimed that the former mayor had made several loans from about 2006 through the next 18 months that followed. These loans added up to a total of $750,000.

Accused of fraud in Florida? You aren't alone says FTC

Fraud. It is a simple term that describes a wide variety of situations involving a deceptive act, false statement or even the concealment of the truth with financial gain as the motivating factor. It is also a word that could lead to very serious consequences for those accused of this offense, whether it relates to tax, investments, securities, insurance or health care.

According to the Federal Trade Commission’s annual Consumer Sentinel Report, more cases of alleged fraud arise out of Florida than any other state. The specific measure used was the number of fraud complaints that were filed per 100,000 people. This past year, there were approximately 1,000 complaints of fraud per 100,000 people.

Judge: Money laundering case involving Bitcoin can go forward

In February, we discussed the possibility of Florida's first money-laundering prosecution related to the digital currency Bitcoin. Two men were arrested in Florida on charges of money laundering and "engaging in an unlicensed money servicing business."

Attorneys for one of the men argued that, since Florida law doesn't recognize Bitcoin as currency, the state doesn't have grounds to prosecute. The judge hearing the case declined to rule on whether or not Bitcoin is a currency under state law; however, the judge did recently say that the prosecution can move forward since the money laundering allegation involves currency other than Bitcoin.

Failure to pay $34,000 sales tax leads charge of tax evasion

Florida residents are part of a rare bunch of individuals that reside in states without an income tax. Of course, this doesn’t prevent the state from collecting taxes from its citizens. Miami residents will pay tax on the goods that they purchase, and that sales tax will then be passed on to the state.

Those that own a business are essentially a middle-man when it comes to collecting these taxes. The business owner will charge their customers the tax, and under state law, this is the moment when the sum no longer belongs to the taxpayer. It doesn’t belong to the business owner either; this taxable sum belongs to the state.

Failure to send the correct sum to the Florida Department of Revenue could be considered tax evasion, an offense punishable in criminal court.