Unlicensed Milwaukee Tax Preparer Charged for $1 Million Fraud

A Milwaukee tax preparation service filed thousands of returns based on phony claims of self-employment that generated as much as $1 million in undeserved refunds, according to the results of an undercover IRS investigation launched in 2011.

Sunday Uwubiti was charged Friday with two federal counts of aiding and abetting the filing of false tax returns. At the same time, prosecutors filed a plea agreement for Uwubiti, who ran Trustee Tax Service at 6114 W. Capitol Drive, according to court records.

According to the charges, Uwubiti and people he supervised falsely claimed self-employment -- complete with fake records of expenses in made up Schedule C forms -- supposedly engaged in by the taxpayers. The returns usually claimed self-employment as barbers, hair stylists, nail technicians, hair braiders, cleaners, musicians and other occupations.

The returns were drafted to maximize filers' claims for Earned Income, Additional Child Tax, Making Work Pay and American Opportunity credits.

The business grew from 36 returns in 2008 to more than 800 in 2011, seeking more than $3.4 million in returns. That year, 655 of the returns included a Schedule C.

The undercover investigation began in March 2011, and on April 18, 2011, agents raided Trustee Tax Service and collected records. That led to interviews with 79 customers who told agents that their returns were falsified and that Uwubiti or his employees would usually make up a name for the filer's supposed business and fill in handwritten notes of expenses on blank Self Employment Verification Forms they then would have customers sign.

The customers said Uwubiti would charge $300 -- taken from the refund -- and offer $35 to $50 for referring other customers to Trustee Tax.

Uwubiti faces up to three years in prison and a $250,000 fine on each of the two counts to which he has agreed to plead guilty. No sentencing date is posted in federal records.

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Copyright 2014 - Milwaukee Journal Sentinel

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