A former New York City corrections officer has pleaded guilty to falsifying tax returns to claim more than $3.4 million in tax refunds, with the help of a former IRS employee.
Rodney Chestnutt, a retired corrections officer, was accused of heading a scheme to submit false tax returns from 2008 to 2012. Chesnutt worked with former IRS employee Clive Henry to prepare the returns and recruit clients, collecting a percentage of each refund paid out by the agency.
The pair, with another individual, used IRS Form 1099-OID to claim the refunds and provided clients with correspondence to elude any suspicion of false claims. The form is commonly used to by brokers to disclose the value of bonds and other securities. Department of Justice officials did not name the other individual.
Chestnutt will be sentenced on May 12, 2016 and faces a maximum of five years in prison, plus a $250,000-fine or twice the amount lost as a result of the crime. In 2013, a federal court enjoined Chestnutt from ever preparing a tax return from anyone but himself.
Henry pleaded guilty to conspiracy to defraud the United States and will be sentenced on March 23, 2016.
