Deena Vang Lee of Fresno, CA, was indicted in April 2019 and charged with wire fraud, aggravated identity theft, aiding and assisting in the preparation and presentation of false and fraudulent tax returns, and making and subscribing false and fraudulent tax returns. She was accused of preparing family and friends’ returns for a fee that claimed thousands of dollars in tax credits for education and childcare expenses that she completely made up—then routed those returns for processing back to the IRS facility in Fresno where she worked.
After a three-day trial, a federal jury last Friday convicted Lee, 41, of those charges.
“Our absolute priority at the IRS is to serve the taxpayers in a manner that fosters confidence in the tax system and compliance with the law,” said Darren Lian, special agent in charge with IRS Criminal Investigation’s Oakland Field Office. “We hold our employees to an even higher standard of expectations and compliance. Unfortunately, Deena Lee betrayed her duty and the trust the American public gave her and suffered the appropriate consequences. We are 100% committed to our tax administration and enforcement mission and will pursue anyone who break the law.”
The Justice Department provided some more deets:
[F]rom 2012 through 2016, Lee willfully prepared and filed tax returns for other individuals that contained materially false and fraudulent statements and underreported her taxable income on her personal tax returns. In her role as a tax preparer, Lee would put false information on the customer’s tax return without their knowledge or consent and submit the returns to the IRS. As part of this scheme, Lee obtained the identification of multiple individuals and falsely listed these individuals as child care providers on multiple customers’ tax returns without their knowledge or consent.
Lee also underreported her own income related to the payments she received for tax preparation services on her personal tax returns for tax years 2013, 2014, and 2015.
According to Law360, Lee charged her family and friends $100 to $400 per return. She also falsely listed some of her clients’ adult family members as dependents on the returns and fabricated college tuition payments that her clients claimed under the American Opportunity Tax Credit. Her scheme resulted in $20,000 in tax loss, Law360 reported.
Lee faces a maximum penalty of 20 years in prison and a $250,000 fine for each of the wire fraud counts; three years in prison and a $250,0000 fine for each of the preparing and presenting false returns counts; three years in prison and a $250,000 fine for each of the making and subscribing a false tax return counts; and a two-year consecutive mandatory minimum sentence for the aggravate identity theft counts. She is scheduled to be sentenced on May 8.