Mr. Tiyari Collins and Mrs. Farah Collins, a married couple, had pled guilty to tax fraud and fraud against COVID relief programs in an amount of at least $5.7 million in total.  The fraud against the COVID relief programs was the result of fraudulent applications for loans from the Paycheck Protection Program (“PPP”) and the Economic Impact Disaster Loan (“EIDL”) program.  Mr. Collins pled guilty to one count of conspiracy to commit wire fraud and one count of aiding and assisting in the preparation of a false tax return.  His wife has pled guilty to one count of conspiracy to commit wire fraud.

The government alleges that Mr. Collins submitted six fraudulent PPP loan applications and five fraudulent EIDL loan applications totaling north of $1.9 million.  Mr. Collins allegedly falsified average monthly payrolls, revenues, and employee counts.  These applications also allegedly included falsified tax returns and payroll reports that were prepared by a third, unnamed individual.  The funds obtained from the COVID relief programs were allegedly used to purchase luxury goods, pay off personal credit cards, and for furniture.

During the course of the investigation, it was discovered that Mr. Collins had filed fraudulent federal tax returns dating back to January 2015 through his tax preparation business.  These fraudulent returns cost the government over $3.8 million in revenue.  On behalf of clients, Mr. Collins allegedly claimed business credits to which his clients were not entitled and filed fraudulent Schedule C’s to reduce the clients’ taxable income.  That fraud followed a suspicious pattern that was detected by the IRS’s Scheme Detection Center.

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