Utah resident Stephen Murphy has pleaded guilty to conspiracy to defraud the U.S. government and was immediately sentenced to two years in prison and one year of supervised release, according the Justice Department and Internal Revenue Service (IRS). He has also been ordered to pay $83,831 in restitution to the IRS. Mr. Murphy has admitted that his intention was to defraud the U.S. Treasury more than $200,000.
Mr. Murphy filed tax returns from 2002 until 2009, in which he claims numerous frivolous and false tax positions. His attempts to evade his tax liabilities included:
- Filing a false income tax return for 2002 claiming no income and no tax due because Mr. Murphy was “not a U.S. person” that was subject to tax;
- Filing several false income tax returns claiming refunds based on fictitious Forms 1099-OID;
- Establishing fake charities attached to his own personal bank accounts, claiming “charitable contribution” tax deductions for money moved into these accounts;
- Submitting Forms W-4 overstating his withholding allowances to minimize or eliminate withholdings by his employers.
Waters & Kraus is a national firm with highly skilled lawyers practicing qui tam litigation in four offices, including Dallas, Los Angeles, San Francisco, and Baltimore. Our attorneys have decades of experience successfully representing whistleblowers in a variety of fraud cases. Contact us or call our attorneys at 800.226.9880 to learn more about our practice and how we can assist.