Accountants Behaving Badly: Drugs and Sex Trafficking, Bookkeeper Busted for Embezzlement, Visa Fraud

Plus, a bunch of tax preparers are going to be spending some quality time in jail.

Kentucky man charged with sex trafficking, drug conspiracy [Associated Press]
Mark Milslagle, a former Kentucky accountant accused of paying for sex with young women who were addicted to drugs, faces federal conspiracy charges.

Mark Milslagle

Milslagle, 49, was charged on Nov. 4 in federal court with conspiring to distribute drugs and conspiring to engage in sex trafficking.

Authorities claim that Logan Ray Towery, 72, provided drugs to young women who were then passed on to Milslagle for sex. Towery has been indicted on similar conspiracy charges and a gun charge.

According to his LinkedIn page, Milslagle was the owner of MJM Tax & Accounting Services in Lexington, KY.

Washington state bookkeeper charged in embezzlement case [Associated Press]
Sara Ann Greenleaf, president of Greenleaf Bookkeeping and Accounting Services in Bellingham, WA, was charged on Nov. 5 with eight counts of first-degree theft and 27 counts of second-degree theft for fraudulently obtaining about $200,000 from a client’s accounts, authorities allege.

Sara Ann Greenleaf

Greenleaf, 45, turned herself in to Bellingham police on Nov. 4 and was later released on personal recognizance.

Dozens of transfers totaling $197,100 were made into Greenleaf’s account between June 5 and Aug. 3 when she had access to the client’s accounts, authorities said. Another eight transactions were made for more than $5,000.

She is scheduled to be arraigned on Nov. 15.

L.A. federal grand jury indicts lawyer and accountant in visa fraud case [MyNewsLA.com]
Young Shin Kim, a naturalized U.S. citizen who previously operated an accounting firm in Diamond Bar, CA, and is now a farmer in Hesperia, was one of two men indicted by a Los Angeles federal grand jury on Nov. 4 for their roles in a scheme to obtain lawful permanent resident status for South Korean nationals by submitting fraudulent visa applications that falsely claimed American businesses wanted to hire skilled foreign workers.

The indictment alleges that Kim and licensed California attorney Weon Keuk Lee exploited the EB-2(a) visa program by submitting bogus Alien Worker Petitions on behalf of companies—some legitimate, some created specifically for the scheme—that purportedly wanted to hire foreign nationals after exhausting attempts to find suitable workers in the U.S.

According to court documents, those South Korean visa applicants paid between $30,000 and $70,000 to Kim and Lee in the hopes of obtaining a visa.

Collier County (FL) tax preparer convicted in multimillion dollar tax fraud scheme [Justice Department]
A federal jury on Nov. 5 found Augustin Dalusma guilty of 12 counts of filing false claims against the IRS and three counts of making or subscribing to false tax returns.

He faces a maximum penalty of five years in federal prison for each count of filing a false claim and up to three years’ imprisonment for each count of making a false tax return. His sentencing is scheduled for Jan. 27, 2020.

Between 2012 and 2015, Dalusma, a tax preparer, falsified information in tax returns for 630 of his clients, fraudulently qualifying them for thousands of dollars in tax refunds that they weren’t lawfully entitled to collect. In total, the false claims filed on behalf of his clients exceeded $4 million over the four-year period.

Dalusma also falsified his own tax returns from 2012 through 2014, significantly underreporting his own income to evade more than $30,000 in taxes for each of those years.

Vegas tax preparer gets 14-month sentence in fraud case [Associated Press]
Trixa Belloso Rivas, a Las Vegas tax preparer who pleaded guilty in May to conspiracy to present false claims, was sentenced to 14 months in federal prison on Oct. 29 and ordered to pay $2 million in restitution to the IRS.

Authorities said Rivas, 55, helped file at least 500 false tax returns that caused the IRS to issue approximately $2 million in fraudulent refunds.

Tax preparer pleads guilty to filing false tax returns [Justice Department]
William Pamintuan Craig, who operated a tax preparation business in Las Vegas, pleaded guilty on Oct. 28 to making and subscribing a false tax return.

When preparing his own tax returns, Craig, 59, underreported his taxable income for tax years 2012 to 2017 by approximately $439,000 in total, causing $143,237 in tax loss.

Furthermore, when preparing his clients’ tax returns, Craig purposely and fraudulently claimed sham “deductions” to which his clients were not entitled. Between 2012 and 2017, Craig caused at least $128,000 in tax loss by filing false returns on behalf of his clients.

Tax preparer charged with fraud in 36-count indictment [Justice Department]
Shawree Hagins, a tax preparer from Millen, GA, was charged with 36 counts of fraud and false statements on Oct. 10 for preparing fraudulent federal income tax returns that resulted in illegally excessive refunds for multiple clients.

In addition to fines and asset forfeiture, the charges carry a possible sentence of up to three years in prison, followed by a period of supervised release.

Hagins is charged with preparing 36 tax returns on behalf of 12 clients, fraudulently claiming deductions in excess of the amount to which the taxpayers were entitled. The fraudulent claims resulted in excessive refunds of $162,890.

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