Latest news with #taxfraud
The Independent
11 minutes ago
- Business
- The Independent
Top Democrat demands Trump's IRS investigate Epstein bank records in sprawling probe: ‘Follow the money'
The top Democrat on the Senate's powerful finance committee has been investigating the financial network surrounding Jeffrey Epstein for three years. Now he wants the IRS to find out what, exactly, the late sex offender was doing in exchange for $1.5 billion in wire transfers that passed through major financial institutions. An investigation, from the office of Democratic Senator Ron Wyden of Oregon, uncovered more than 4,700 transactions dating to 2003, including payments to women from Russia and eastern European countries. More than $158 million came from Wall Street financier Leon Black between 2012 and 2017 for Epstein's alleged tax support, according to Wyden's report, and ultimately helped Black avoid more than $1 billion liabilities. 'None of these tax transactions Epstein performed were audited,' Wyden told reporters at a briefing Thursday. 'It could have blown the lid off Epstein's cover of being a financial genius … It looks like none of that ever happened … A bunch of federal officials were sleepwalking through this.' In a letter to Donald Trump's recently-appointed IRS Commissioner Billy Long, Wyden demanded a list of any and all audits involving Epstein, and whether the agency ever evaluated 'the full scope' of his alleged tax planning services. 'I want the IRS to go back and make sure that there was actually tax advice being given rather than what I suspect was going on, which is a lot of payments revolving around sex trafficking,' Wyden said. Wyden's financial probe has taken on new urgency in the weeks after the Trump administration failed to release any new revelations from the so-called 'Epstein Files' and concluded no further investigation was needed, much to the uproar of his supporters and Republican allies. Trump, whose friendship with Epstein spanned more than a decade, has insisted that the public and press should move on from questions about the case. Epstein died by suicide in his jail cell awaiting trial on federal sex trafficking charges in 2019, sparking conspiracy theories that the government is participating in a cover up to protect powerful public figures who exploited and abused young girls. Trump has repeatedly denied any connection to Epstein's infamous lifestyle, having ended their friendship before the disturbing allegations about the financier emerged in 2006. Earlier this month, the president sued The Wall Street Journal, its publishers and right-wing media mogul Rupert Murdoch for $10 billion over an article that reported he sent a 'bawdy' birthday card message to Epstein for his 50th birthday. Trump called the report false and defamatory. Wyden's office uncovered "inexplicably large' sums that were funneled into Epstein's accounts as well as 'suspicious activity reports,' or SARS, which are recorded by banks as a means of detecting signs of illegal activity for federal law enforcement. Bank of America reported potentially suspicious payments involving Black in February 2020 and October 2020, following Epstein's death, according to Senate investigators. 'We've got paper trails, we've got account numbers, we've got federal files from where it all began with Leon Black,' Wyden told The Independent Wednesday. The Independent has requested comment from Black and his former asset management firm Apollo Global. Confidential bank reports, filed with the Treasury Department and IRS, could provide a vital look at the massive financing machine behind Epstein's sex trafficking operation, which spanned New York City, Florida and the U.S. Virgin Islands. Insights have previously been limited to testimony and filings in litigation against him. The Independent has requested comment from the IRS and Treasury Department. Filings uncovered by the senator's office include $1.5 billion in transactions through four big banks, including wire transfers from wealthy figures over the sales of artwork, fees paid to Epstein, and payments to several women. But the banks appeared to have waited until Epstein's arrest on federal charges to flag the transactions. The largest suspicious activity report was filed in 2019 by JPMorgan for $1.1 billion, according to the senator's office. Other suspicious activity reports include a payment through Deutsche Bank totaling $400 million, $78 million from Bank of New York Mellon and Bank of America's logs on Black's payments to Epstein. In 2023, JPMorgan paid $290 million to Epstein's victims and Deutsche paid $75 million to settle lawsuits that claimed the banks ignored red flags surrounding trafficking allegations. The Trump administration and Republican leadership on the Senate Finance Committee have stonewalled Wyden's office, according to the senator, leaving the senator hamstrung by confidentiality laws surrounding transactions. The impasse is why the Oregon senator wants the Trump administration to make the reports available to Congress, which can then subpoena banks for more information, he said. Wyden's office also laid out steps for the Department of Justice to begin investigating 'hundreds of millions of dollars in wire transfers' that passed through 'several now-sanctioned Russian banks.' 'It appears that these wire transfers were correlated to the movement of women or girls around the world,' Wyden recently wrote to the Justice Department. He also told the DOJ that it appears to have 'ignored evidence' from the Treasury Department. Trump has said Attorney General Pam Bondi can decide what files connected to the Epstein case could be made public. 'This is not about politics. It is not about red and blue. It is about an evil individual who committed horrific crimes and victimized an enormous number of women and girls,' Wyden told reporters. 'At a time when so many Americans think that the political system is rigged, this is about whether there's going to be accountability for the people who were involved and who enabled it, and the fact that so much money was being spent indicates that this was a global sex trafficking ring,' he added.
The National
5 hours ago
- Politics
- The National
UK tax authority warns of fake social media posts
Claims in a social media video that the British government is tracking taxpayers who travel overseas more than three times a year have been rejected as a fake by the UK 's tax authority, HM Revenue and Customs. The video has been circulated widely in the Middle East, causing alarm among British nationals overseas and UK residents. It claims that from August 4, a new branch of HMRC and the Home Office – called the Mobility Oversight Unit – will check whether a person's employment status and tax record match their lifestyle. This is part of an 'enhanced customs monitoring' programme to tackle benefit fraud and tax evasion, the video and other related social media posts claim. HMRC said the information contained in the video was false. 'This video is disinformation, designed to cause undue alarm and fear. Anyone wanting information on rules around taxation should go to or seek advice from a tax professional,' an HMRC spokesperson said. Many social media users commented under the video that the information was false, but that did not stop it being widely shared. Fact-checking charity Full Fact traced the video back to a TikTok account, where the post had been shared more than 66,000 times and liked by 57,200 accounts. The video claimed the information was first reported by The Guardian, but there was no evidence of this on the newspaper's website. Full Fact added that while there are existing restrictions on the length of travel for people claiming benefits, the system in described in the video does not exist. The Home Office was contacted for comment. British government departments are being targeted with misinformation. One widely shared post on social media says 'the UK government is hiring' for a 'Shariah law administrator'. A separate post claimed 'the role is for the Department of Work and Pensions' alongside a screenshot of a – now deleted – listing for Manchester Community Centre. The job description says the successful candidate will 'provide all admin and secretarial work for Manchester Shariah Council'. In fact, the advert was not for a government job and the administrator was being hired using money a mosque said it had raised through donations. The job was advertised on a portal run by the government, where private employers can post. It is not known whether any of the posts are part of a hostile state-backed cyber campaign. UK government bodies have repeatedly warned of threats from online and phishing operations by actors in Russia and Iran. Earlier this year the UK's National Cyber Security Centre exposed a cyber campaign by military unit 26165 of Russia's GRU intelligence directorate against western logistics providers and technology companies that had been running since 2022.
Daily Mail
5 hours ago
- Daily Mail
Self-proclaimed millionaire gold mine owner stole taxpayer cash for mansion, yacht and supercars
A Georgia man was found guilty of stealing nearly $13 million from taxpayers by submitting fraudulent documents that, among other things, claimed celebrities like Keanu Reeves and Gene Hackman worked for his sham African gold mine business. Carl Delano Torjagbo, also sometimes called Karl Lucius Delano, spent his ill-gotten gains on a mansion, supercars, plastic surgery and even a yacht down payment, according to court records. Torjagbo, 49, was convicted on Friday by a federal jury of bank fraud, wire fraud and money laundering. Prosecutors said Torjagbo's scheme began on February 13, 2021, when he submitted two individual tax returns to the IRS falsely claiming that his millions of dollars in personal losses should offset earnings he made through Kremkov Industries, his supposed gold mine in Ghana. Each tax return had different social security numbers and dates of birth, but the US Treasury still cut Torjagbo a refund check for $3.3 million. Prosecutors said that days later, he sent a loan application through the Paycheck Protection Program (PPP), an initiative created in the beginning of the COVID-19 pandemic to provide immediate cash injections to struggling businesses. The February 16 application said Kremkov Industries had nearly 500 US-based employees and had an average monthly payroll of nearly $4 million, according to court documents. Prosecutors said the gold mine and the hundreds of employees that supposedly worked for it were fake. In documents Torjagbo sent to banks about his fake gold mine business he made up to get a $9 million PPP loan, he claimed that Keanu Reeves and Gene Hackman worked for him, prosecutors said This was demonstrated when investigators found that the payroll reports Torjagbo submitted contained the names of celebrities and fictional characters. 'According to Torjagbo, 493 people were living in the United States but working a mine in Ghana,' Theodore Hertzberg, a US Attorney with the Northern District of Georgia, told Fox 5 Atlanta. 'And he identified, by name, a number of those employees to the banks. Individuals like Keanu Reeves, Gene Hackman, Oliver Twist, Jon Snow. This really was a notorious fraud,' Hertzberg added. Despite all of this, Torjagbo received a $9.6 million PPP loan on March 29, 2021, a little over a month after he applied for the program. It didn't take long for him to start spending the inordinate sum. By June 2021, he bought a $1.7 million mansion in Marietta. The over 9,000-square-foot behemoth has eight bedrooms, seven-and-half-bathrooms and a luxurious pool area. It also has a three-car garage that would later house the three luxury vehicles he purchased. He spent $333,000 on a 2014 Lamborghini Aventador, $120,000 on a 2022 BMW M850xi and $90,000 on a 2021 Land Rover Range Rover Velar. Torjagbo is pictured in Aspen, Colorado, in January 2022 while on a ski trip. This was roughly nine months after prosecutors said he stole taxpayer funds He also put a $51,000 down payment on a 72-foot yacht and spent more than $15,000 on plastic surgery, with the goal of achieving 'gladiator abs,' court records show. Approximately $1 million was spent to acquire land, trucks and trailers to start a new freight and logistics business called FlyingJack, according to court documents. Torjagbo's social media pages remain up. One post on Facebook shows him jet-setting to Aspen, Colorado, for a ski trip in January 2022, just months after he stole the money. 'Torjagbo defrauded a federal loan program of which its intended use was to assist businesses in covering rent, utility payments, and other job saving needs during the COVID-19 pandemic,' IRS Special Agent Demetrius Hardeman said in a statement. 'Taxpayers' money that should have gone to these businesses instead went to Torjagbo, who then used it to fund his lavish lifestyle,' he added. Torjagbo now faces a maximum of 170 years in prison, though the judge will almost certainly hand down a significantly shorter term based on the US Sentencing Guidelines.
Yahoo
a day ago
- Business
- Yahoo
How the IRS catches tax cheats: 3 ways your tax return may get flagged
Cheating on your taxes is a form of high-stakes gambling. You might catch a break and evade suspicion, but the IRS is incentivized to go after those Americans who don't pay what they owe — an amount that totals hundreds of billions in unpaid taxes each year. An estimated $514 billion in individual income taxes went unpaid in 2022, according to the most recent IRS data. Add in unpaid corporate, employment and estate taxes and the tax gap that year was $696 billion. Enforcement actions and late payments reduced that amount by an estimated $90 billion. Some Americans may be even more tempted to roll the dice now that the IRS has slashed its workforce by 25 percent so far this year, according to the most recent data from the Treasury Inspector General for Tax Administration. While 84 percent of taxpayers say it's 'not at all acceptable' to cheat on income taxes, 29 percent agree it's fair to avoid paying some taxes if they no longer trust the government will spend taxpayer dollars wisely, according to 2024 results of an annual taxpayer attitude survey conducted by the IRS. That's a pretty blasé attitude about a crime that carries consequences ranging from steep fines to potential prison time. Learn more: Tax fraud: What it is and what you should know to avoid scams And, while workforce cuts at the IRS could reduce audit activity, the IRS has other ways to monitor for cheating, says Heather Liston, a certified financial planner and principal of Clarity Financial in San Francisco. In particular, the IRS uses what's known as a DIF score (for 'discriminant function') to identify problematic returns, and the ratios are intentionally kept a secret so people can't game the system. 'We don't know what they are because the IRS doesn't want us to know what they are,' Liston says. Some common issues that raise potential 'cheating' flags with the IRS include math errors, underreporting income, unusually high business expenses or tax deductions, failing to take required minimum distributions from retirement accounts, and cost basis issues with restricted stock units or real estate transactions, Liston says. Here are three ways the IRS monitors tax returns for cheating. 1. Your numbers don't match third-party data When filing your taxes, you must input your wage information from the W-2 form your employer provided to you, along with income you may have earned from other sources that's documented on various 1099 forms. Those companies must also supply that information to the IRS. And the figures should match. 'What the IRS really likes, and strives for, is third-party reporting because there's very little opportunity for cheating,' says Mark Luscombe, a certified public accountant and principal analyst at Wolters Kluwer Tax & Accounting in Chicago. That's because it's easy for the IRS to identify reporting discrepancies that are problematic, he says. If the income or payment information you input doesn't match what was sent to the IRS, you will receive a CP2000 notice from the IRS. Read the CP2000 notice to understand why the IRS believes there's a discrepancy and what you need to do next, Liston says. Even if your inclination is to shove this notice under a stack of papers and ignore it, it's important that you take action. Call the phone number provided right away if you need more time to figure out why the problem occurred, she adds. There may be rare circumstances in which you knowingly provide information to the IRS that's different than what's on the tax form — in which case you should document why you're doing so, Luscombe says. Otherwise, the problem is often easily solved, though you may need to send more money for unpaid taxes. The longer it takes to resolve the issue, you could incur more interest on unpaid taxes and penalties, Liston says. That's why it's best to try to avoid receiving this notice in the first place. 'Anything a computer can catch, it will,' Liston says. 'In a way, it's a little bit silly the IRS makes us go through the exercise of filling out the information because they already know it.' Learn more: 2025 tax brackets and federal income tax rates 2. Your self-employed business income or expenses seem off While the IRS's exact methods for identifying potential instances of cheating remain a mystery, the agency does scrutinize the information that taxpayers report on Schedule C, Liston says. This form applies to taxpayers who are self-employed, either operating a business as a sole proprietor or working as a freelancer. Learn more: Schedule C: What it is and how it works If you claim very high business expenses every year — particularly in relation to your income — that could draw the attention of the IRS, Liston cautions. And while you should claim expenses you're entitled to, it's important to be accurate, Luscombe says. There's a long-held myth that home office-related expenses can trigger an audit. There's no evidence that's true, though these expenses could raise some red flags. There's 'clearly the potential for abuse' with taxpayers claiming a home office that's actually a part of the house that's not exclusively used as a home office, as the IRS dictates it should be, Luscombe says. 'I suspect there are a lot of 'home offices' where the kids go in and watch movies and the like.' The IRS won't appear on your doorstep to confirm your home office is the size you claim or that it's being used exclusively for that purpose, but that myth could be a good reminder to be cautious. When possible, Liston says, be sure to have documentation of expenses like meals or transportation costs. But just because these expenses could elicit extra scrutiny by the IRS, Liston notes, 'that doesn't mean you shouldn't claim them.' Learn more: The home office deduction: Who qualifies and how to calculate it 3. Your tax deductions or credits seem fishy The standard deduction for taxpayers was nearly doubled as part of the Tax Cuts and Jobs Act of 2017, which now means that less than 10 percent of taxpayers claim itemized deductions. (That higher standard deduction, plus a new inflation adjustment for 2025, was made permanent as part of the megabill that was signed into law in July.) Abuses of itemized deductions, particularly related to the value of charitable donations, was once something the IRS closely monitored to identify potential instances of fraud, Luscombe says. And it still does, albeit among the now-minority of taxpayers who itemize deductions. There are other tax breaks that many Americans can claim that may also seem fishy to the IRS. The IRS seems 'very concerned,' Liston says, with catching people who cheat in some way when claiming the earned income tax credit (EITC) for low- to moderate-income workers and families. While it's hard to know exactly what the IRS scrutinizes, it's important to only claim deductions that legitimately apply to your situation. Learn more: 10 easy tax deductions and credits to trim your tax bill Resist the urge to underreport your income Not all income is reported to the IRS through a third-party source, and it may be particularly tempting to omit this information while filing your taxes. That's because companies are only required to send you — and the IRS — a 1099 form for payments that exceed certain thresholds. And those thresholds were recently raised for some of the most common 1099 forms. Even if you made less than the amount required to generate a form, the IRS is looking for taxpayers who don't report all of their income, no matter whether they do so intentionally or mistakenly. 'That could be an honest mistake, but you still need to get caught up and make it right,' Liston says. You should receive a 1099 form if you did contract or freelance work that totaled at least $600 for one company in 2025, though the massive new tax bill signed into law in July boosts the reporting threshold for 1099-NEC and 1099-MISC forms to $2,000 starting in 2026. That same tax law also changed the reporting threshold for 1099-K forms — which report payments of goods and services on platforms like Venmo, Cash App and PayPal — to $20,000 plus 200 transactions. That reporting threshold is now in effect for 2025. The IRS has been pushing for more third-party reporting, especially in the case of the 1099-K forms, to ensure taxpayers are fairly reporting all of their income, Luscombe says. But the agency has been challenged by companies that argue this paperwork is unduly burdensome, he adds. The higher reporting thresholds — meaning that you can receive a higher amount of freelance income without the company that paid you reporting it — may tempt you to report less income. But knowingly omitting this income when you file your tax return is fraud. Even if it seems unlikely the IRS will catch you, you don't get off the hook for reporting income just because you don't receive a form for it, Liston says. 'I never advise anyone to lie about that,' she says. 'You are responsible for reporting all of your income.' Get started: Match with an advisor who can help you achieve your financial goals Why double-checking your tax return is so important Before you file your taxes, go through your return to make sure nothing stands out as peculiar. A vast majority of taxpayers now file their taxes electronically, which has reduced simple math errors, but you could still make a small mistake that will result in a big headache with the IRS. Receiving a notice in the mail from the IRS about a problem with your return, while unpleasant, doesn't necessarily suggest you'll be audited or accused of fraud. It's 'really important' not to panic, Liston says, though you need to take these notices seriously and reply in a timely manner, and that's particularly true if you have an explanation for why the information you supplied differs from the IRS's calculation. And you won't be surprised by a notice that immediately accuses you of tax fraud. Rather, that accusation will only come after a series of notices and fair warning before the IRS formally accuses you of tax fraud after a thorough investigation. Finally, your intent matters. Some taxpayers confuse tax avoidance via legitimate planning and legitimate tax strategies with tax evasion, in which you're illegally trying to lower your tax obligation. The two terms are very different, Luscombe says. 'Fraud implies a willfulness to it.' Learn more: Tax avoidance vs. tax evasion: One's illegal, the other is smart financial planning Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Yahoo
Two Sacramento residents sentenced to prison for false income tax returns
( — Two Sacramento residents were sentenced to prison for a false income tax return scheme, Acting U.S. Attorney Kimberly announced on Monday. According to the United States Department of Justice, Dominic Davis, 40, and Sharitia Wright, 61, both of Sacramento, were sentenced to federal prison for conspiring to file false claims. Davis received a sentence of three years and four months in jail, and Wright received a sentence of one year and three months in jail. Mother-son duo sentenced to prison for inmate unemployment insurance claims According to USDOJ, the court documents showed that between March 2019 and April 2022, Davis and Wright caused at least nine fraudulent income-tax returns to be filed with the IRS, claiming more than $2 million of income tax refunds. The returns had been filed in both Davis, Wright, and family members and listed wages that taxpayers did not receive, officials said. Many of the returns listed the taxpayers' employer as one of the various LLCs created by Davis, Wright, and their family members. Many of the returns, the USDOJ said that had falsely claimed charitable contributions that were not made. Davis had prepared and filed the false tax returns. Wright provided him with information and contacted the Internal Revenue Service to check on the status of the refunds that were claimed in the false tax returns. The USDOJ said both of them have been ordered to pay restitution for the fraudulent income tax refunds that they had received. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
