Xenia man guilty of false tax claims


Xenia Daily Gazette

DAYTON — Robert Coates, 37, of Xenia pleaded guilty in federal court Monday to filing false claims for income tax refunds with the Internal Revenue Service (IRS).

Coates faces a maximum of five years in prison and a fine of up to $250,000.

According to court documents, between January 2012 and July 2012 Coates filed false claims for income tax refunds with the IRS. Coates presented himself to be a tax preparer in Xenia, and filed fraudulent income tax returns on behalf of individuals who were referred to Coates by other taxpayers or for those who responded to a flyer Coates distributed in and around the Xenia area, according to a press release from the IRS.

Coates enticed individuals to allow him to file their income tax returns by explaining to them that they would receive an income tax refund even if they did not work or were receiving disability payments, the release said.

Unbeknownst to the taxpayers, the IRS said Coates included fraudulent amounts of income in the form of Household Help income (known as “HSH”) in order to maximize the earned income credit and to generate an income tax refund. In addition, Coates included fraudulent amounts of qualified educational expenses in order to generate a refundable education credit. Coates filed these income tax returns knowing that the HSH income amounts and qualified education expenses were fraudulent and the claimed income tax credits and refunds were fraudulent, the IRS said. Coates collected his fee by diverting a portion of the income tax refund into one or more bank accounts that he controlled.

In total, Coates filed at least 170 false income tax returns for 2011 income tax year, causing a loss to the IRS in the amount of $445,450, of which $167,422.63 was directed into bank accounts in Coates’ name or under his control, according to the press release.

A sentencing date has been set for Nov. 10.

“While most return preparers provide excellent service to their clients, a few unscrupulous tax preparers file false and fraudulent returns to defraud the government, the tax-paying public and their own clients,” said Kathy A. Enstrom, special agent in charges, IRS Criminal Investigation, Cincinnati Field Office. “Mr. Coates wreaked havoc on the integrity of our tax system in a very short period of time.”

Content provided by IRS.

Content provided by IRS.

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