Cranston Woman Admits to Stealing $800,000 in Tax Refund Fraud Scheme

CRANSTON, RI—A 48-year-old Cranston woman and tax preparer pleaded guilty yesterday to preparing false tax returns, wire fraud, theft of government funds and identity theft as part of a scam in which she puffed up bogus client tax returns with fake dependents and exemptions, pocketing $800,000.

Belkis M. Guzman, who worked at Providence El Centro Multiservicios LLC in Providence, admitted in U.S. District Court in Providence on Thursday between 2009 and 2011 she filed tax returns on behalf of clients with false dependents, exemptions and tax credits. She also deposited more than 100 U.S. Treasury checks into her bank account generated by false returns prepared by others.

U.S. Attorney Peter F. Neronha said that Guzman doled out some of the ill-gotten proceeds to others who participated in the scheme and "received a percentage of the negotiated checks as a payment for depositing checks into her account."

U.S. District Court Judge William E. Smith will sentence Guzman on Dec. 2 and she faces up to 20 years for the wire fraud count, 10 for the theft of government funds, three for assistance in the preparation of false tax returns for clients and a mandatory two years for each count of aggravated identity theft.

Guzman's former boss, former Providence City Councilman Leon F. Tejada, 51, of Providence, was sentenced one year and one day in federal prison in April for overseeing two tax fraud schemes to steal refund money from 76 taxpayers whose returns he filed.

He, too, doctored tax returns without the knowledge of his clients to increase tax refunds. An Internal Revenue Service Investigation showed the combined amount of money he stole from the government and victim clients was $78,548. Smith ordered Guzman to pay full restitution.

Neronha commended the hard work of special agents of Internal Revenue Service’s Criminal Investigation, who conducted the investigation and Assistant U.S. Attorney Richard Rose and Tax Division Trial Attorney Christopher O’Donnell, who are prosecuting this case.