Rashia Wilson and her boyfriend filed more than 220 fraudulent tax returns from 2009 to 2012, claiming $1.9 million in false tax refunds. The IRS approved most of the returns and sent out $1.3 million in refunds. Rashia Wilson posted her crime on her Facebook page, along with a picture and a caption: YES IM RASHIA THE QUEEN OF IRS TAX FRAUD. IM A MILLIONAIRE FOR THE RECORD SO IF U THINK INDICTING ME WILL BE EASY IT WONT I PROMISE U!
The truth that being rich does not help criminals escape punishment must have become apparent to her when investigators searched her home in September 2012, and found evidence of tax fraud including debit cards, bundles of money, nine computers, a hangun, and ledgers with the personal information of more than 1,600 people, including medical records.
Wilson pleaded guilty to the federal weapons offense relating to the gun seized from her home, but did plead not guilty to tax fraud. Both she and her boyfriend will go to trial in March 2013.
TBO shares the details of how the ordinary couple carried out a tax scam of such enormous propositions:
The returns made use of tax credits that authorities say are known to be vulnerable to fraud. The returns listed Dallas addresses, and in most instances, the occupation of the purported filer was listed as sales or cook.
Scores of the returns were filed from local hotels, and some were filed from Wilsons home, according to court documents.
A visitor to her spacious house reported seeing bags of cash. Wilson also drove a new Audi, purchased with a $90,000 cashiers check.
At the same time, Wilson reportedly collected $668 a month in food assistance from the state. In applying for the benefit, she claimed she earned $200 a month working as a hairstylist. She reported no employment income in her own name to the IRS.
Unfortunately, this tax scam is just the tip of the iceberg. Due to the loopholes in the IRS system for spotting fraudulent tax claims, the country loses billions of dollars of tax money annually. Tax credits are also used by tax frauds to dupe the IRS. TBO explores the scope and depth of tax scams:
Without proper controls, billions of taxpayer dollars are vulnerable to erroneous claims and fraudulent tax schemes, the inspector general for the IRS wrote in an October report, which led the IRS to announce it was tightening controls over the credits.
The IRS estimates it paid $99 billion to $119 billion in improper payments for the earned income credit alone from fiscal year 2003 through 2011, according to the report, which says the IRS has no estimate for improper payments of other credits.
The Hope education credit, also known as the American Opportunity Tax Credit, was the subject of a 2011 report by the Treasury Inspector General for Tax Administration, which said billions of dollars in the credits were being erroneously paid.
The $2,500 credit, designed to offset the costs of higher education, became refundable up to $1,000 in 2009, the same year investigators say Wilson started committing tax fraud.
With the tax fraud increasing each year, the IRS and the government need to seriously consider putting better controls in place to spot and prevent tax fraud.
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