TRENTON
—Attorney General Peter C. Harvey
today announced that a joint-agency tax
fraud investigation targeting the theft
of thousands of dollars from the state
treasury has resulted in the arrest of
an Essex County tax preparer on charges
of filing hundreds of false or fraudulent
New Jersey State Income Tax Returns which
resulted in unentitled refunds being issued
in the names of fictitious “taxpayers.”
The ongoing investigation has uncovered
the filing of nearly 300 fraudulent New
Jersey tax returns seeking over $195,000
in illegal refunds.
“This
investigation uncovered a deliberate and
blatant attempt to steal tens of thousands
of dollars from the state treasury through
the filing of hundreds of false or fraudulent
tax returns. The prosecution of this defendant
demonstrates the resolve and forward thinking
by the Division
of Criminal Justice and the Division
of Taxation as they undertake concerted
efforts to target those who attempt to
steal or cheat the treasury,” said
Attorney General Harvey. “Make no
mistake, we intend to recover tax dollars
owed to both the state treasury and to
New Jersey’s honest taxpayers.”
Treasurer John E. McCormac noted that
this violator attempted to abuse, for
his personal gain, a tax refund program
which had been established to assist the
working poor, and that such offenses,
committed during a period of significant
budgetary pressures, “victimize
all New Jersey citizens.”
Vaughn L. McKoy, Director, Division of
Criminal Justice and Robert K. Thompson,
Director, Division of Taxation, said that
Ramoni Mustapha, 50, 221, Custer Ave.,
Newark, Essex County, was arrested and
charged via a criminal complaint with
theft by deception and filing and/or preparing
false or fraudulent tax returns. Mustapha,
a self-employed tax preparer and the owner/operator
of Ramsalam Business and Tax Consultancy
located at 103-105 South Day St., Orange,
Essex County, was arrested on April 15
at his Orange business location by State
Investigators from the Division of Criminal
Justice - Financial Crimes Bureau and
tax agents from the Division of Taxation’s
Office of Criminal Investigations.
Criminal Justice Director McKoy noted
that in conjunction with Mustapha’s
arrest, the state law enforcement agents
conducted a search of Mustapha’s
office pursuant to a court authorized
search warrant issued by Mercer County
Superior Court Judge Charles A. Delehey.
As a result of the search warrant, State
Investigators confiscated and seized tax
returns, various tax documents and records,
computer systems, false/fraudulent credit
cards and identification documents, and
related evidence. Mustapha has been released
from the Mercer County Jail after posting
$100,000 bail. An arraignment hearing
will be scheduled. The second degree charges
each carry a maximum penalty of up to
ten years in state prison and a fine of
up to $150,000 upon conviction.
The criminal complaint alleges that Mustapha
filed at least 293 fictitious and/or fraudulent
resident New Jersey State Income Tax returns
for the tax years 2001 and 2002. The Division
of Taxation determined that the purported
fraudulent returns were filed during 2004
and 2005 and that $194,693 in Earned Income
Tax Credit (EITC) refund checks were issued.
It is alleged that Mustapha prepared and
filed the fraudulent state income tax
returns based on false identifying information
which qualified the “taxpayer”
for an unentitled refund of up to $725.00
using the EITC. The EITC gives taxpayers
a New Jersey refund based on the percentage
of money refunded on the federal tax return.
In order to claim the EITC, individuals
must meet certain criteria, including
filing a federal EITC, have at least one
qualifying child listed on the Federal
EITC Schedule, have New Jersey gross income
of $20,000 or less, and have the same
filing status on both the state and federal
tax returns.
Director Thompson commended the Division
of Criminal Justice for immediately mobilizing
its resources to quickly obtain the necessary
search and arrest warrants after discovery
of the scheme by the Division of Taxation’s
forensic auditors.
“With
the arrest and filing of criminal charges
against Mustapha, the alleged illegal
tax preparation operation has been effectively
shut-down,” said Criminal Justice
Director McKoy. “The investigation
will be presented to a State Grand Jury
for possible indictment.”
Chief Investigator Sue Kane of the Division
of Taxation - Office of Criminal Investigation
and State Investigator Eric Ludwick of
the Division of Criminal Justice - Financial
Crimes Bureau coordinated the investigation.
Supervising Deputy Attorney General Terrence
Hull and Deputy Attorney Denise Grugan
of the Division of Criminal Justice -
Financial Crimes Bureau along with Assistant
Chief Rich Mawer and Assistant Chief Bob
Morris of the Division of Taxation’s
Office of Criminal Investigation, conducted
the investigation.
Director Thompson noted that anyone with
information about unscrupulous tax preparers,
or any type of tax fraud, are encouraged
to contact the New Jersey Division of
Taxation’s “Citizens Against
Tax Cheats or CATCH” program. The
hotline number is: 609-292-6400.
Information can also be mailed to the
New Jersey Division of Taxation, 50 Barrack
Street, P.O. Box 190, Trenton, NJ 08695-0190,
Attention: Citizens Against Tax Cheats.
In announcing the criminal investigation,
Director McKoy noted that the Division
of Criminal Justice has established a
toll-free “Corruption TipLine”
at 1-866-TIPS-4CJ for
the public to report corruption, financial
crime, and other illegal activities. Any
information received via the Division
of Criminal Justice “Corruption
TipLine” or the Division of Taxation
“CATCH Hotline” will remain
confidential.
Additional information is available via
the Division of Criminal Justice Web site
at www.njdcj.org.
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