An Atlantic City man who used a tax fraud scheme to steal more than $1.3 million from the IRS has been sentenced to 78 months in federal prison.
Kenneth Crawford Jr. was convicted of conspiring with others to sell "mortgage recovery" tax fraud scheme that obtained fraudulent refunds for their clients.
Crawford promoted the scheme to people facing foreclosure or behind on their mortgage payments.
He told them they could extinguish their outstanding mortgage debts by filing tax forms with the IRS.
The clients would falsely claim that a substantial amount of taxes had already been withheld from them, resulting in the IRS issuing significant refunds to which the clients were not entitled.
As a result of Crawford’s scheme, more than $2.5 million in fraudulent refunds were sought from the IRS, resulting in a payout of more than $1.3 million.
Crawford charged a fee of about 25 percent for each refund obtained.
When the IRS discovered the fraud and attempted to recover the previously issued refunds, Crawford provided clients with false documents to send to the IRS, directed clients to conceal from the IRS his role in filing the false returns, and advised clients to remove funds from bank accounts in their names in order to thwart IRS collection efforts.
A federal jury in Camden convicted him Dec. 17 of conspiring to defraud the United States, filing false claims and obstructing the internal revenue laws.
Once he has completed his sentence, Crawford must serve three years of supervised release.
He also was ordered to pay nearly $1.4 million in restitution.
Acting Deputy Assistant Attorney General Goldberg commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorney Sean Green and Assistant Chief John Kane, who are prosecuting the case. He also thanked the U.S. Attorney’s Office for the District of New Jersey for its assistance and support during the investigation and prosecution of this case.
