Four defendants were found guilty in Fresno on Monday in a November 2015 trial for a tax refund scheme that claimed over $33 million in refunds, U.S. Attorney Benjamin Wagner said.
Gaylene Lynnette Bolanos, 58, of Fresno, was sentenced to 10 years in prison and ordered to pay $429,300 in restitution, Wagner said. Leroy Donovan Combs, 74, of Fresno, was sentenced to three years and nine months in prison.
Charles Wayne Uptergrove, 57, of Madera County, was sentenced to three years and three months in prison, Wagner said. Ladonna Lee Moon, 55, of Texas, was sentenced to a year and nine months in prison.
Before the trial, three co-defendants pleaded guilty to submitting false claims to the IRS and were sentenced, Wagner said. On Feb. 29, Louis Calles, 67, of Fresno, was sentenced to 16 months in prison and James Schwartz, 61, of Fresno, to one year and a day in prison. Oswald Georgner, was sentenced to 18 months in prison.
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According to court documents and testimony at trial, between August 2008 and Oct. 16, 2008, Bolanos and Georgner, with the help of their co-defendants, submitted false tax returns in an attempt to eliminate their debts and receive sizable tax refunds, Wagner said. The tax returns were fraudulent because the defendants listed their debts, bulls, and other non-income items as interest income.
The defendants then claimed that almost all of that interest income had been withheld and paid to the Internal Revenue Service, even though none of the purported interest income was ever withheld, Wagner said. Based on the reported withholdings, the defendants claimed they were owed millions of dollars in refunds by the IRS.
In all, the defendants submitted false tax returns to the IRS seeking more than $33 million in fraudulent tax refunds, and in response, the IRS issued approximately $400,000 in unearned refunds, Wagner said.