Authorities have indicted seven individuals in one of the most significant COVID tax fraud schemes, leaving questions about how such schemes have affected U.S. tax relief efforts.
Key Takeaways
- Seven suspects charged in a $600 million COVID-related tax scheme.
- 8,000 false tax returns were filed, exploiting relief programs.
- The fraud involved shell companies and a “Credit Reset” front.
- The IRS lost approximately $45 million to these activities.
- The defendants, if convicted, face severe legal consequences.
The Fraud Unveiled
The indictment of seven individuals reveals a sweeping scheme exploiting COVID-related tax relief programs. The suspects allegedly operated under the guise of a credit repair business, “Credit Reset,” coordinating efforts to submit over 8,000 fraudulent tax returns. This led to an attempt to steal more than $600 million in tax credits, the largest of its kind in the U.S.
The group utilized shell companies and bogus financial records to deceive the IRS. Communication through texts, calls, and WhatsApp helped conceal their actions. By not listing themselves as paid preparers and employing VPNs, they eluded detection for an extended period.
Federal grand jury indicts 7 in $600M COVID-19 benefits scheme
By Clyde Hughes, 1 day ago
UPI NewsJan. 23 (UPI) — A federal grand jury charged seven people with running a multi-state conspiracy attempting to defraud the United States for more than $600 million by filing more…
— Miranda C. Bell Reporting NMS15a Felony Crimes (@truthsearch1957) January 25, 2025
Government and Legal Response
The DOJ has charged these individuals with 45 counts, including conspiracy to defraud the United States and wire fraud. The IRS-CI, alongside the United States Postal Inspection Service, is vigorously pursuing the matter. According to CI Chief Guy Ficco, “In the last year alone, we have opened nearly 700 new COVID fraud investigations that collectively add up to $5 billion in potential fraud.”
The prosecutions are handled by the Eastern District of New York, with involvement from the Department of Justice’s Tax Division. The culprits include notable names like Keith Williams, Jamari Lewis, and others. Defense attorneys are preparing to challenge the charges, claiming them to be baseless.
Implications and Future Actions
Defendants tried capitalizing on pandemic relief for personal gain at a time when businesses were struggling. The IRS reportedly lost approximately $45 million, impacting taxpayers nationwide. With potential sentences up to 20 years for wire fraud, justice seeks to prevail.
This case, while notable, is not isolated. As IRS-CI New York Special Agent in Charge Chavis emphasizes, “Criminals have found ways to exploit every iteration of aid offered through the COVID-19 pandemic relief funds…” Efforts continue to pursue those exploiting relief programs to ensure rightful assignment and usage of funds.
Sources:
- Defendants Charged With Filing Over 8,000 False Tax Returns In Largest COVID Tax Credit Case To Date
- Seven individuals charged in largest employee retention credit scheme case in the United States | Internal Revenue Service
- 7 Charged in America’s Biggest COVID Tax Credit Fraud Scheme | The Epoch Times
