Three Florida Men Plead Guilty in Multimillion-Dollar Tax Refund Scheme

Christopher Johnson, of Orlando, Florida, and Jasen Harvey, of Tampa, Florida, pleaded guilty yesterday to conspiring to defraud the United States by promoting a tax fraud scheme called the “Note Program.” 

Arthur Grimes, of Ocoee and Orlando, Florida, previously pleaded guilty on April 2 to obstructing the IRS in connection with the scheme.

According to court documents and statements made in court, from 2015 to 2018, Johnson and Harvey conspired to promote a scheme in which Harvey and others prepared tax returns for clients that claimed large nonexistent income tax withholdings had been paid to the IRS, and sought large refunds based on those purported withholdings.  The conspirators charged clients fees and required them to pay over a portion of the fraudulently obtained refunds.

Overall, the defendants claimed over $3 million in fraudulent refunds on their clients returns, of which the IRS paid about $1.5 million.

Grimes participated in the scheme by causing four false income tax returns prepared by Harvey to be filed. When the IRS attempted to recover a refund issued to Grimes based on one of those returns, Grimes made false statements and submitted false documents to an IRS revenue officer and transferred funds to a nominee bank account.

Johnson was paid more than $200,000 in 2016 and more than $100,000 in 2017 as his share of the proceeds from the scheme. Johnson filed false tax returns for those years that did not report that income, resulting in a tax loss of $78,259.

A sentencing hearing will be set at a later date for Johnson and Harvey. They each face a maximum penalty of five years in prison for the conspiracy charge.

Grimes is scheduled to be sentenced on Nov. 12. He faces a maximum penalty of three years in prison for the tax obstruction charge.

All three defendants also face a period of supervised release, restitution and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Roger B. Handberg for the Middle District of Florida made the announcement.

IRS Criminal Investigation investigated the case.

Trial Attorneys Melissa Siskind, Jeffrey McLellan and Caroline Pearson of the Justice Department’s Tax Division and Assistant U.S. Attorney Diane Hu for the Middle District of Florida are prosecuting the case.