A Dunkirk man does not claim to see dead people, but he is in trouble for filing their tax returns.
John Berry, 42, of Dunkirk was charged with first-degree offering a false instrument, a class E felony and fourth-degree attempted grand larceny, a class A misdemeanor, on Monday. Berry had been under investigation for tax fraud and filing fraudulent income tax returns in the names of deceased people.
According to the Tax Department's investigation, a number of withholding statements (W-2s) allegedly used fraudulently by Berry claimed wages from a nonprofit entity in Chautauqua County, and the people listed on the W-2s had died. Berry filed 40 New York income tax returns from 2008-09 claiming fraudulent refunds totaling $25,194.
Working with the Internal Revenue Service, the department learned in those same years Berry sought $200,000 in illegal refunds by filing 122 federal returns, again using the Social Security numbers of the deceased. Berry has pled guilty to the charges brought by the IRS, and his next court appearance will be on Oct. 15.
"This is a case in which the state, leveraging information from the federal government, was able to identify multiple instances of stolen identity, and bring them to an end," said Commissioner Thomas Mattox of the New York State Department of Taxation and Finance. "It appears the defendant clearly set out to steal on a regular basis from the state, and by doing so, cheat all the taxpayers of New York who pay their fair share. Such criminal activity won't be tolerated."
The arrest was made and the case investigated by the Criminal Investigations Division (CID) of the New York State Tax Department. In addition, a CID officer has been appointed as the special assistant district attorney to prosecute the case. CID is comprised of attorneys, criminal investigators and auditors tasked with uncovering violations of the State Tax Law.
In New York, 96 percent of taxes are paid by businesses and individuals who voluntarily meet their tax responsibilities. The remaining 4 percent is collected through the Tax Department's audit, collections and criminal investigations programs.
According to the IRS Data Book, in 2012, the IRS assessed 2,962 cases of civil tax fraud, 180 cases of business tax fraud, 403 cases of employment tax fraud and 37 cases of excise tax fraud. And according to CNN, the IRS identified roughly two million tax returns which were possibly fraudulent in 2011, which was a 72 percent increase from 2010. However, only 2,000 people were actually convicted of tax crimes, which is .0022 percent of all taxpayers.