Refund madness; without oversight; waste not, definitely want not; and other highlights of recent tax cases.
Pittsburgh: Ephrem F. Lijalem, a resident of Carpentersville, Illinois, and operator of tax refund stores in Pittsburgh, has pleaded guilty to aiding or assisting in the preparation or filing of false federal income tax returns.
Lijalem operated Cititax Tax Refund stores; he and taxpayers defrauded the IRS out of $7.2 million in illegal refunds. The government maintained that Cititax preparers at stores owned by Lijalem in Pittsburgh regularly falsified Schedules C for clients with non-existent business, inflated income, and altered expenses to maximize refunds.
Sentencing is May 31. He faces a total sentence of six years in prison, a fine of $500,000 or both.
Alamogordo, New Mexico: Nonprofit exec and CPA firm partner Marion L. Ledford, 67, has been sentenced to a year and six months in prison for tax evasion after submitting a personal income tax return in 2016 that substantially underreported his taxable income for 2015.
Ledford, who pleaded guilty in 2019, was a director for the Robert W. Hamilton Foundation, a nonprofit providing scholarships to high school graduates in Otero County, New Mexico. He controlled the foundation’s finances without oversight. For more than five years, Ledford wrote checks to himself totaling $1,785,300 from the foundation’s accounts.
He filed returns, prepared by the CPA firm where he was a partner, for 2011 to 2016 that reported some…
