PHOENIX – Attorney General Mark Brnovich announced a State Grand Jury indicted Connie Cozzolino, owner of Connie’s Tax Services, her son Richard Luttrull, and Jennifer Lohss aka Jennifer Drziewicki, on charges of Fraudulent Schemes and Artifices, Illegal Control of an Enterprise, 24 counts of Preparing False Tax Returns and Forgery for Allegedly Preparing Arizona Personal Income Tax Returns that contained fraudulent information for tax years 2012-2018.
The Criminal Investigations Unit of the Arizona Department of Revenue (ADOR), in cooperation with the Arizona Attorney General’s Office, performed the investigation. After discovering anomalies in returns filed by Connie’s Tax Services through ADOR’s fraud prevention program, investigators interviewed individual taxpayers regarding the unusual deductions appearing on their Schedule A, Itemized Deductions.
The investigation alleges that, without the knowledge or consent of the taxpayers, Cozzolino, Luttrull, and Lohss prepared Arizona income tax returns that included improper, inflated, or fictitious itemized deductions for items such as medical and dental expenses, unreimbursed employee expenses, or gifts to charity. It is further alleged that for the 2018 tax year, W-2 wage income was improperly reported on Schedule C as income from a sole proprietorship to circumvent the change in the law removing unreimbursed employee expenses from itemized deductions in most situations.
The alleged inclusion of the fraudulent deductions resulted in approximately $19,000 in inflated refunds and evaded taxes. The taxpayers, in this case, will be responsible for filing amended returns and repayment of the excess refund or the additional tax due plus any interest. ADOR does not impose a monetary penalty on taxpayers who have been victimized by a tax preparer.
ADOR recommends that all taxpayers carefully review their prepared tax return, including any schedules, to ensure accuracy before filing. Taxpayers are also warned to watch out for tax preparers who promise unusually large refunds, charge a percentage of your refund rather than a flat fee, or say things that sound too good to be true. For more tips and information on considering a tax preparer, here is a link to ADOR's latest bulletin.
ADOR’s fraud prevention program has stopped over $120 million in fraudulent refunds since fiscal year 2016.
All defendants are presumed innocent until proven guilty in a court of law.
Assistant Attorney General Mary Harriss is prosecuting this case.
Copy of indictment here.
Monday, March 2, 2020