A Smyrna resident has been sentenced for presenting false claims for refunds to the Internal Revenue Service over the course of 3½ years, according to the U.S. Department of Justice.
Tamar Lee, 53, was sentenced to four years and three months in prison. She was also ordered to pay restitution of more than $300,000.
Co-conspirators Jeffrey Smith and Don Terry were also sentenced. Smith was sentenced to three years and one month in prison and ordered to pay restitution of more than $690,000. Terry got two years in prison and was ordered to pay restitution of more than $1.3 million. All three were additionally sentenced to three years of supervised release following their prison time.
The scheme resulted in false claims for refunds in excess of $2 million. The IRS subsequently paid more than $1 million in refunds for fraudulently filed corporate and individual income tax returns.
“The defendants stole the personal identifying information of innocent victims, netting more than $1 million in fraudulent refunds,” U.S. Attorney Kurt R. Erskine said.
Lee and Terry obtained names and personal identifying information for individuals without their knowledge and consent. Many of the victims lived outside of Georgia, with some residing in shelters or prison at the time the tax returns were filed, according to Erskine, who oversees the Northern District of Georgia.
Lee and Terry provided the victims’ information to a now deceased co-conspirator, a local tax return preparer with her own tax preparation business who was responsible for filing the returns. The forms listed employers for whom the victims did not work. They also submitted refunds based on false claims of federal income tax withholdings never paid to the IRS.
A refund transfer service allowed the co-conspirator to print refund checks at her place of business and give them to Terry and Lee, who would then deposit them into bank accounts Lee opened and controlled. Lee paid the co-conspirators a portion of those proceeds.
Lee also used one of her existing companies to file fraudulent corporate tax returns that falsely claimed refunds based on bogus fuel tax credits. Lee’s company did not qualify for the credit, but the IRS paid one of the requested refunds.
Lee, Terry and Smith were also part of a scheme to submit fraudulent corporate income tax returns. They filed returns with the same preparer for other existing companies and for companies they created. Those returns all falsely claimed refunds based on fuel tax credits to which the companies were not entitled. The IRS paid some of the refunds by mailing Treasury checks to addresses provided by Lee, Terry and Smith.
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