Navy veteran gets 18 months in prison for $1 million tax scam

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 The military has a Volunteer Income Tax Assistance/Electronic Filing (VITA/ELF) program that helps active-duty servicemembers, their dependents, Department of Defense personnel serving with military units, military retirees and others in filling out their taxes at no cost.    Patrick Gordon/U.S. Navy
The military has a Volunteer Income Tax Assistance/Electronic Filing (VITA/ELF) program that helps active-duty servicemembers, their dependents, Department of Defense personnel serving with military units, military retirees and others in filling out their taxes at no cost. Patrick Gordon/U.S. Navy

Navy veteran gets 18 months in prison for $1 million tax scam

by: David Hernandez | .
The San Diego Union-Tribune | .
published: March 07, 2016

A former Navy sailor was sentenced Friday to 18 months in prison for filing false tax returns in a scam that resulted in more than $1 million in fraudulent tax refunds for fellow sailors, the U.S. Attorney’s Office said.

Leonard Washington pleaded guilty in November to tax evasion and filing false tax returns.

U.S. District Judge Jeffery Miller at the sentencing also ordered Washington to pay $926,668 in restitution to the Internal Revenue Service.

Washington was an active-duty sailor aboard the Higgins, a guided missile destroyer stationed in San Diego, when he convinced more than 140 sailors to pay him $1,000 each to file their income tax returns in 2010, according to court documents.

Washington told them he could get them special breaks, including “special military tax” deductions, because of their military status. He admitted in November to adding gambling winnings and losses, credits and tax witholdings to get more refunds for his clients.

Despite receiving more than $140,000 in preparation fees from clients, Washington concealed his role as tax preparer from the IRS. He funneled his earnings into various bank accounts to disguise his income and evaded more than $49,000 in personal federal income taxes, the U.S. Attorney’s Office said.

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