FOR IMMEDIATE RELEASE:
January 10, 2001
Norma Estimbo Lacy
Public Affairs Specialist
Phone: 713/567-9388 Fax: 713/718-3389
E-Mail: usatty.txs@usdoj.gov
CITY OF HOUSTON EMPLOYEE PLEADS GUILTY
TO INCOME TAX REFUND SCHEME
Albert A. Balboni, Assistant U.
S. Attorney
Phone: 713/567-9726
(Houston) Mervyn M. Mosbacker, United States Attorney for the
Southern District of
Texas, announced today that Carl Dennis Barnett, age 48,
pled guilty on Tuesday to five counts of filing false and fraudulent
claims for income tax refunds for 1996 and 1997 and one count
of conspiracy to file false claims for
refund. Barnett, who is a senior payroll clerk for the City of
Houston, is currently in jail awaiting a hearing on the State's
motion to revoke his state parole based on the federal fraud
charges. Barnett was on parole for a murder conviction from the
early 1980's when he committed the federal offenses. Barnett's
plea of guilty came during the second day of trial while IRS
Special Agent Amy LaCour was testifying about the false income
tax returns and W-2 forms found during a search of Barnett's
house.
During his plea, Barnett admitted that he had conspired with
his co-defendant, Daniel Webb to file false claims for refund
with the Internal Revenue Service. Barnett admitted that Webb
solicited individuals to provide their names and social security
numbers which Barnett used to prepare false Forms W-2 to make
it appear the individuals worked for various entities, including
Foley's Department Stores and the City of Houston. False income
tax returns were also prepared by Barnett. Refunds received from
the scheme were split between Barnett, Webb and the unemployed
individual who allowed their name and social security number
to be used. Barnett's fingerprints and handwriting were found
on several of the documents located during searches of Webb's
car and Barnett's house, including slips of paper that matched
the dollar amounts on the fraudulent W-2's. Barnett and Webb
worked together to file at least eighteen fraudulent income tax
refund claims totaling $29,905.00. Quick work by the IRS prevented
all but approximately $5,000 of the bogus refunds from being
issued.
Co-defendant Daniel Webb, age 42, pled guilty previously to one
count of conspiracy to file false claims for refund and agreed
to cooperate with the United States. Webb testified during the
first day of Barnett's trial that Barnett had asked him to participate
in the scheme by providing names and social security numbers
of individuals who had not worked during the year. Webb also
testified that any fraudulent refund received was split 50-50
by Barnett and the unemployed individual with Webb receiving
$300.
Barnett and Webb each face a possible sentence of ten years imprisonment,
three years supervised release, and a fine of $250,000 for the
conspiracy count. Barnett also faces a possible sentence of five
years imprisonment, three years supervised release, and a fine
of $250,000 for each of the five counts of filing a false claim
for refund. The case was investigated by Special Agents of the
Internal Revenue Service and was prosecuted by the United States
Attorney's Office.
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