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Goose Creek Tax Return Preparer Sentenced to Prison for Filing Fraudulent Tax Returns

FILE

GOOSE CREEK, S.C.–United States Attorney Beth Drake stated today that Stacy B. Middleton, age 47, of Goose Creek was sentenced in federal court in Charleston on two felony counts of Willfully Preparing and Filing a False Income Tax Return, in violation of Title 26, United States Code, Section 7206(2).

Senior United States District Court Judge Patrick Michael Duffy sentenced Middleton to 41 months imprisonment and 1 year of supervised release.

According to court documents and in statements made during court hearings, Middleton owned and operated a tax preparation business in Charleston named MBM Tax & Accounting Services, LLC (“MBM”).

For calendar years 2009, 2010, and 2011, Middleton prepared and electronically filed over 1,300 false and fraudulent income tax returns for his clients without their knowledge in order to increase their refunds.

The income tax returns contained overstated, duplicated or fictitious deductions, fictitious Schedules C to maximize Earned Income Tax Credits, fabricated expenses for Schedules A, C and E, fraudulent refundable credits, and fictitious Forms 1099. Middleton admitted that his scheme caused a tax loss of $3,500,000.

Ms. Drake stated that the case was investigated by agents of the Internal Revenue Service-Criminal Investigation.  Assistant United States Attorney Dean H. Secor of the Charleston Office prosecuted the case.

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