A pair of Florida men have entered guilty pleas in the United States District Court, Middle District of Florida, in connection with a scheme to file false tax returns for their clients.
The two men, Franklin Carter Jr., and Jonathan Carrillo, face charges of conspiracy to defraud the United States, according to an announcement by the U.S. Attorney’s Office made on June 2. The defendants entered their guilty pleas with Magistrate Judge David Baker prior to jury selection.
Several co-conspirators in this case have also pleaded guilty.
According to court documents and statements made in court, from 2016 to 2020 Carter and Carrillo owned and operated Neighborhood Advance Tax (NAT), a return preparation business with a dozen offices throughout Florida.
Prosecutors claim that Carter, Carrillo and their co-conspirators fraudulently inflated client tax refunds by fabricating deductions on their returns. They also reportedly held periodic training sessions at which they taught other NAT employees how to prepare fraudulent tax returns.
Court documents also detail how, In 2021, Carter, Carrillo and the co-conspirators started another tax return preparation business called Taxmates, which was operated out of the same offices that NAT had previously used. As with NAT, Carter, Carrillo and the others allegedly used Taxmates to prepare false tax returns for clients. Many of those returns included false deductions. As before, Carter, Carrillo and their co-conspirators also taught franchise owners and employees how to prepare false returns for clients.
Additionally, Carter did not file personal tax returns for 2019 through 2021, despite being legally required to do so.
In total, both men caused a tax loss to the IRS exceeding $12 million, according to prosecutors.
Carter and Carrillo will be sentenced later for their conspiracy charges, facing a maximum of five years in prison. Carter could receive up to one year for each failure to file a tax return, while Carrillo may face three years for each false tax return charge.
Both will also confront supervised release, restitution and fines.