Lowell Tax Preparer Fined $483G in Fraud
LOWELL -- Lowell tax preparer Samuel Dangaiso has been permanently barred from operating a tax preparation business and ordered to pay $483,000 following allegations that he defrauded clients by filing falsified tax returns and pocketing the inflated refunds, Attorney General Maura Healey announced Wednesday.
This punishment comes two years after the state ordered Dangaiso to halt his business for allegedly filing more than $2 million in fraudulent deductions and pocketing more than $150,000 for himself.
On Wednesday, a consent judgment -- including the payment order and permanent injunction -- was entered in Middlesex Superior Court against Dangaiso and his unregistered company Tax Enterprises.
“This defendant filed millions of dollars in fraudulent deductions on behalf of his clients and pocketed thousands of dollars based on their falsified tax returns,” Healey said in a statement. “This tax season, we ask members of the public to exercise caution and contact my office about any tax preparation scams.”
Dangaiso could not be immediately reached for comment on Wednesday.
The Attorney General’s Office sued Dangaiso and his company in February 2017 after an investigation conducted by the Massachusetts Department of Revenue revealed that Dangaiso was engaged in serial tax fraud and unfair and deceptive business practices relating to personal income tax returns in Massachusetts.
According to the complaint, Dangaiso filed hundreds of tax returns containing inaccurate information, including unjustified deductions, false bank account information and fake dependents, without the knowledge or consent of his clients.
Dangaiso allegedly used these inaccurate tax returns to generate inflated tax refunds that he directed to his bank account or a prepaid debit card, transferring the amount his customer expected as a refund and keeping the remainder for himself. The complaint alleged Dangaiso kept at least $150,000 of the funds generated by this scheme.
During the course of the investigation, prosecutors in the attorney general’s office secured a preliminary injunction barring Dangaiso from continuing to serve as a tax preparer while the lawsuit was ongoing. In January 2018, Dangaiso admitted to violating this injunction and was ordered by the court to pay $30,000.
The permanent injunction prohibits Dangaiso from preparing and submitting state tax returns for Massachusetts taxpayers, and orders him to pay $483,000.
Under the judgment, any state income tax refunds Dangaiso may be eligible to receive in the future will be used to pay back the clients he defrauded, and further violations of the order would automatically trigger additional sanctions.
AG’s tips on using tax preparers
Attorney General Maura Healey and the Massachusetts Department of Revenue encourage taxpayers to consider the following tips this tax season when choosing a tax preparer:
* Qualifications: Paid tax preparers are required to have a Preparer Tax Identification Number or PTIN. Ask to see it along with proof of membership in a professional organization. Any history of disciplinary actions is available through the Better Business Bureau or the Massachusetts Board of Public Accountancy.
* Service fees: Avoid those who charge a percentage of your refund or who claim they can obtain larger refunds than other preparers. Always make sure any refund due is sent to you or deposited into an account in your name. Do not have your refund deposited into a preparer’s bank account.
* Filing methods: Paid preparers who file more than 10 returns to the IRS or Massachusetts Department of Revenue must file returns electronically. It is the safest method for processing returns and the quickest way to get a refund. Whether filing electronically or by paper, never sign a blank return. Before you sign your return, review it and ask questions. Make sure you understand everything and that you are comfortable with the accuracy of the return before you sign it.
* Preparation: Good preparers will ask for your records and receipts and will also ask questions to report total income to get you the tax benefits that you are entitled to claim.
* Signature: Paid preparers must sign returns and include their PTIN as required by law. The preparer must also give you a copy of the signed return.
Consumers who are concerned that they may be a victim of tax fraud can call the Department of Revenue’s Tax fraud hotline at 1-800-792-5254 or 617-887-6780.
Follow Rick Sobey on Twitter @rsobeyLSun.