According to the U.S. Department of Justice, Christopher Johnson of Orlando, Florida, and Jasen Harvey of Tampa, Florida, have pleaded guilty to defrauding the U.S. government through a tax fraud scheme called the “Note Program.” The scheme involved promoting fraudulent tax returns that claimed significant, nonexistent withholdings, resulting in the payment of large refunds. Between 2015 and 2018, Johnson and Harvey prepared and filed these fraudulent returns, collecting over $3 million in improper refunds, of which approximately $1.5 million was paid out by the IRS.
Grimes participated in the scheme by arranging for Harvey to file four false income tax returns. When the IRS attempted to reclaim a refund awarded to Grimes based on one of those returns, he made false statements, submitted falsified documents to an IRS tax officer, and transferred money to a nominee bank account.
In 2016, Johnson received over $200,000 and in 2017, more than $100,000 as his share of the scheme’s revenue. He filed false tax returns for those years and failed to report that income, resulting in a tax loss of $78,259.
Sentencing for Johnson and Harvey will be scheduled at a later date. Both face a maximum of five years in prison on the conspiracy charges.
Grimes is scheduled to be sentenced on November 12 and faces up to three years in prison for tax evasion.
All three defendants are also subject to probation, restitution and fines. A federal district judge will determine their sentences after considering U.S. sentencing guidelines and other statutory factors.
The announcement was made by Acting Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Roger B. Handberg for the Middle District of Florida.
The case was investigated by the IRS Criminal Investigation Division.
Trial attorneys Melissa Siskind, Jeffrey McLellan and Caroline Pearson of the Justice Department’s Tax Division are prosecuting the case, along with Assistant U.S. Attorney Diane Hu for the Middle District of Florida.
