Criminal Justice News

Thursday, July 16, 2015

Former Washington, D.C., Tax Return Preparers Sentenced to Prison for Conspiracy



A former Washington, D.C., public school teacher and tax return preparer and her son, a current Washington, D.C., public school teacher and former tax return preparer, were sentenced to prison today in the U.S. District Court for the District of Columbia, announced Acting Assistant Attorney General Caroline D. Ciraolo of the Justice Department’s Tax Division.

Sherri Davis, 42, and her son, Andre Davis, 24, both of Washington, D.C., were convicted by a federal jury on Jan. 29 of one count of conspiracy to defraud the United States.  Sherri Davis was also convicted of 25 counts of aiding and assisting in the preparation and filing of false federal individual income tax returns and three counts of filing her own false tax returns.  Andre Davis was also convicted of one count of aiding and assisting in the preparation and filing of a false tax return.

U.S. District Court Judge Thomas Hogan of the District of Columbia sentenced Sherri Davis to serve 48 months in prison to be followed by three years of supervised release, and ordered her to pay $642,103 in restitution to the Internal Revenue Service (IRS) and a $2,900 special assessment.  Judge Hogan sentenced Andre Davis to serve six months of home detention and 100 hours of community service as part of five years of supervised release, and ordered him to pay $37,537 in restitution to the IRS and a $200 special assessment.

“Identifying and prosecuting fraudulent return preparers are among the Tax Division’s highest priorities,” said Acting Assistant Attorney General Ciraolo.  “Today’s sentences demonstrate that those who willfully assist U.S. taxpayers in filing false returns and in doing so, stealing from the U.S. Treasury, will pay a heavy price for their criminal conduct.”

According to the evidence presented at trial, from 2003 through 2012, Sherri Davis was the owner and operator of 2FT Fast Facts Tax Service, a tax return preparation business located in Washington, D.C.  In 2012, Sherri Davis changed the business name to Davis Financial Services and Andre Davis was designated as the owner and operator of that business.

At trial, the evidence established that Sherri and Andre Davis prepared and filed false tax returns for clients that included various false and fraudulent deductions, expenses and credits intended to reduce the amount of taxes owed and obtain refunds for their clients that were larger than the clients were entitled to receive.  In some instances, Sherri and Andre Davis, and others working for them, included false and fraudulent Schedules C that reported false business losses and Schedules A that reported fraudulent itemized deductions.  On some of the returns, Sherri and Andre Davis completely fabricated the Schedule C businesses.  On other returns, the Schedule A included false or grossly inflated gifts to charity, job expenses and other miscellaneous expenses.

The evidence at trial further established that for calendar years 2007 through 2009, Sherri Davis filed her own false income tax returns on which she failed to report more than $300,000 in tax preparation fees that she received from her business.

“IRS-Criminal Investigation is focused on cases where greedy individuals, who for their own personal benefit, participate in identity theft schemes to accumulate ill-gotten wealth at a cost to the taxpayer,” said Special Agent in Charge Thomas Jankowski of the IRS-Criminal Investigation (CI), Washington, D.C., Field Office.  “In cooperation with the Department of Justice, IRS-CI is committed to holding thieves, such as Sherri and Andre Davis, accountable for their misdeeds.”

Acting Assistant Attorney General Ciraolo commended special agents of IRS-Criminal Investigation and the Washington, D.C., Office of Tax and Revenue-Criminal Investigation Division, who investigated the case, and Trial Attorneys Jessica Moran, Tiwana Fleming and Mark McDonald of the Tax Division, who prosecuted the case.  Ciraolo also thanked the U.S. Attorney’s Office of the District of Columbia for their substantial assistance.

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