Friday, December 9, 2011

Idaho Tax Preparer Charged With Massive Fraud

Posted By on Fri, Dec 9, 2011 at 9:19 AM

An Idaho tax preparer with more than 180 clients in 30 states is charged with being on the wrong side of the tax law. Federal prosecutors said Penny Lea Jones of Idaho Falls, who used the name Penny Lea Wardrop for her business, filed false tax returns claiming more than $120 million in refunds.

Prosecutors accused Jones of a so-called "redemption theory" tax scheme, claiming people could get tax refunds for combining their mortgages, car loans, credit cards and other debts. Prosecutors also said Jones warned clients that they should take big tax refunds and "hide them from the government" by converting them to gold or silver or depositing money at casinos in return for cashier's checks.

Jones faces 10 years in prison, plus a maximum of five years for each of 41 counts of fraud.

Six others were charged with taking part in the alleged scheme.

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