NEWARK, N.J. – Todd P. Halpern, a Livingston tax return preparer today admitted filing false claims with the IRS. According to U.S. Attorney Paul J. Fishman, Halpern used a deceased tax return preparer’s identification and prepared false documents for numerous fraudulent loans.
Halpern, 48, pleaded guilty today before U.S. District Judge William J. Martini to filing false claims and wire fraud.
According to documents filed in this case and statements in court:
In late 2008, Halpern purchased A & V Financial (A & V), a tax return preparation business located in Guttenberg, N.J., from the wife of the prior owner, V.R., who had died in March 2008. Halpern received the company’s computers and all of its client records. As part of the agreement to purchase A & V, Halpern was to obtain a new Electronic Filing Identification Number (EFIN) in his own name. Due to the fact that Halpern had a criminal record which prevented him from obtaining his own EFIN, he continued to file tax returns using V.R.’s EFIN.
From 2009 through 2010, Halpern prepared and filed 657 fraudulent federal income tax returns with the IRS using V.R.’s EFIN. Halpern also prepared and filed some of these tax returns without the knowledge or authorization of the taxpayers identified on the returns. Some of these tax returns contained fraudulent income and deduction amounts, which generated fraudulent refunds that were directly deposited into Halpern’s bank account.
In one instance, Halpern prepared and filed a fraudulent 2008 Form 1040 U.S. Individual Income Tax Return that fraudulently claimed an income tax refund of $13,183. The 2008 claim prepared by Halpern contained false income and deduction entries for B.G. because B.G. did not have any income for that tax year and so did not need to file an income tax return. From this incident, $13,183 was directly deposited into Halpern’s bank account adding to the total amount of $373,938 he received in fraudulent tax refunds.
Halpern used the money to support a lavish lifestyle which included purchases from Prada, Chanel, Saks Fifth Avenue, and Bloomingdales. He also acquired season tickets to the New York Giants, purchased thousands of dollars in jewelry, gold coins, silver certificates, and made car payments on multiple luxury cars including a 2007 Cadillac Escalade, a 2008 Lexus GX-470, and to buy car parts for his classic 1957 Chevy Bel Air.
From January 2008 through May 2012, Halpern also prepared false documents for multiple fraudulent loans from financial institutions. He prepared tax returns, Forms W-2, and bank statements showing inflated income and asset balances to be used to support loan applications for borrowers, including himself, to acquire mortgage loans, primarily involving residential properties in New Jersey, as well as other personal and business loans. Halpern and others caused the fraudulent documents to be submitted to mortgage lenders, other financial institutions, the U.S. Department of Housing and Urban Development, and the Federal Housing Administration (FHA), which were relied upon for the approval of mortgage and other loans.
In November 2009, Halpern served as the buyer for the short sale of 215 Newark Ave., Bloomfield, N.J., from seller B.S. for a purchase price of approximately $185,000. An FHA-insured mortgage loan of $181,649 was obtained by Halpern from a N.J. based mortgage company. Again, numerous fraudulent documents were sent to the FHA and to the mortgage company, including false bank statements, pay stubs and 2008 federal income tax returns in Halpern and his wife’s names.
As in his tax fraud scheme, the false tax returns that Halpern prepared reflected V.R.’s identification number in an effort to conceal that Halpern had personally prepared the tax returns.
At the plea hearing, the Court also entered a Consent Judgment and Order of Forfeiture for $373,938 and for a classic 1957 Chevy Bel Air, which constitutes the proceeds that Halpern obtained as a result of his frauds.
The wire fraud count to which Halpern pleaded guilty is punishable by a maximum potential penalty of 30 years in prison and a fine of up to $1 million, or twice the gross amount of pecuniary gain or loss resulting from Halpern’s offense.
The tax fraud count carries a maximum penalty of five years in prison, and a maximum fine of $250,000.
Sentencing for Halpern is scheduled for Sept. 10, 2013. U.S. Attorney Fishman credited special agents of the FBI, under the direction of Special Agent in Charge Aaron T. Ford; special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Shantelle P. Kitchen; and special agents of the U.S.
Department of Housing and Urban Development, Office of Inspector General, under the
direction of Special Agent in Charge Cary Rubenstein, with the investigation leading to today’s guilty plea.
Assistant U.S. Attorney, Aaron Mendelsohn of the Economic Crimes Unit and Evan Weitz of the Asset Forfeiture and Money Laundering Unit of the U.S. Attorney’s Office in Newark are representing the government.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force which was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.
With more than 20 federal agencies, 94 U.S. Attorneys’ offices and state and local partners, it’s the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.
Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.stopfraud.gov.