Tried To Take Millions In Undue Credits
A Jamaica accountant and two other individuals have been charged with participating in a scheme in which more than 350 state tax returns were submitted during a nine-month period in 2010, fraudulently seeking more than $6 million in tax credits to which the taxpayers were not eligible to claim.
The alleged scheme was discovered by the State Tax Department during the processing of the returns filed for 2009.
Queens District Attorney Richard A. Brown identified the defendants as certified public accountant MD Hyder Alam, 47, of 175th Street in Jamaica; Mohammed Liton Khan, 55, of 81st Street in Ozone Park and Kazi Alamgir, 52, of Highland Avenue in Jamaica.
Alam maintains the firm MD Hyder Alam, CPA P.C., located at 169-26 Hillside Ave. He previously maintained offices at 167-17 Hillside Ave., which he rented from Alamgir, who operates Century Best Homes, also at 169-26 Hillside Ave.
Khan operates a company known as Sehangal Corp., registered to his home address.
Alam and Khan have each been charged with first-degree attempted grand larceny, second-degree grand larceny, first-degree falsifying business records, first-degree scheme to defraud and second-degree criminal tax fraud. Alamgir has been charged with second-degree grand larceny, first-degree scheme to defraud and second-degree criminal tax fraud.
If convicted, each of the defendants face up to 15 years in prison.
“As the tax season winds down this weekend, taxpayers who have not yet filed their returns are cautioned to be careful when hiring a tax preparer as any unscrupulous action undertaken by them could impact on the taxpayer’s tax liability,” Brown said. “In addition, taxpayers should know that there are no ‘secret tax credits’ known only to a few tax preparers, as alleged in this case.”
State Taxation and Finance Commissioner Thomas H. Mattox added, “We commend District Attorney Brown and his team for their vigorous efforts to apprehend fraudulent tax preparers, This case illustrates the effectiveness of law enforcement agencies to collaborate in the interest of justice. Using advanced business analytics and third-party data sources, my department uncovered this serious crime that will now be prosecuted by the District Attorney. We look forward to our continued partnership on behalf of New York taxpayers.”
According to the criminal charges, Alam prepared 367 state tax returns for the 2009 tax year in which he claimed unqualified special additional mortgage recording tax credits in the aggregate amount of $6,103,984 on behalf of the taxpayers. It is alleged that all but two of the 367 returns listed the home address of the taxpayer as being the home address of either defendant Alam or Khan.
The New York State Department of Taxation and Finance indicated taxpayers are not allowed to claim the unqualified special additional mortgage recording tax credit if their real property is located in either Erie County or any of the counties within the Metropolitan Commuter Transportation District, which is comprised of the counties of New York, Bronx, Queens, Kings, Richmond, Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk, and Westchester. In this case, it is alleged that all the taxpayers involved either lived in one of the above-mentioned counties or out of state.
In carrying out their scheme, it is alleged that taxpayers were “steered” to Alam by Khan and Alamgir and others in return for a “referral fee”- which allegedly could run as high as 50 percent of the refund-for having arranged a meeting between the taxpayers and Alam. They claimed Alam specialized in applying for “secret mortgage recording tax credits” (which do not actually exist) made possible by the Obama Tax Relief Program, and that Alam only knew about the credits because a “legislator” had told him about them.
Finally, it is alleged that $317,010 in phony tax refunds were paid out on 14 returns before the state Department of Taxation halted the scheme.
The investigation was conducted by the state Department of Taxation and Finance, with the assistance of Accountant Investigator John M. Murphy of the Queens County District Attorney’s Office, under the overall supervision of Supervising Accountant Investigator James J. Dever.
Assistant District Attorney Morgan A. Goulet of the District Attorney’s Economic Crimes Bureau is prosecuting the case under the supervision of Assistant District Attorneys Gregory C. Pavlides, bureau chief, and Christina Hanophy, deputy bureau chief, and the overall supervision of Executive District Attorney for Investigations Peter A. Crusco and Deputy Executive Assistant District Attorney for Investigations Linda M. Cantoni.
It was noted that a criminal complaint is merely an accusation and that a defendant is presumed innocent until proven guilty.