This episode unveils the twisted saga of a tax attorney’s vengeance that resulted in not one, but multiple murders. Ashley Pallow was a tax attorney from St. Lucie, Florida who had a bit of a reputation for being aggressive and for pushing the boundaries of the law. Incredibly, Ashley himself had been charged with murder prior to his own, but was acquitted due to lack of evidence. Ashley seems to be a magnet for murder! Just six months before ending up dead and wrapped in an acid-covered rug in his storm cellar, a man named John Wilson attempted to murder Ashley for having an alleged affair with his girlfriend. After the police find Ashley’s body, they investigate two of his tax employees, Thomas Bard and Michelle Lockridge who had been the last people thought to see Ashley alive. In response to her arrest, Michelle discloses that she was having a paid sexual relationship with Ashley and that his death had been accidental, but later she changes her story to blame Thomas. To make matters even more confusing, another witness, Christopher Higgins, has a different story for what happened to Ashley, sending the investigation in a new direction.

Talking Points:

• Who was Ashley Pallow and what was he like according to his family and employees

Quotes

• “Yeah that might be a little uncomfortable for me…he sounds just like a typical tax pro.“ (4:09-4:43 | Dominique) 

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In this episode, CPAs and hosts Dominique and Tom cover information about tax fraud cases and how they can be prevented. Today, the main focus is on the tax fraud case of the very overwhelmed Roger Stadtmueller, a certified public accountant who had his license revoked and was fined for committing tax fraud.

We also discuss the stress of tax season and how easy it is for CPA’s to experience burnout. Life doesn’t stop for accountants simply because of deadlines and in this case, life’s problems continued to mount for Roger Stadtmueller like hot air balloon accidents and lawsuits, deaths, divorces and business failures. Even though life presents many challenges, it is important to be aware of the consequences of engaging in fraud and asking for help when the going gets tough.

This episode as always provides valuable insights and practical tips for anyone looking to ensure they are in compliance with tax laws and regulations and avoid any potential legal trouble. Tune in now! 

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This episode reveals the shocking conclusion of the story of Wagdy Guirguis and his CPA Michael Higa. The IRS’s investigation of Hawaii Pacific Finance reveals that for nearly 12 years, Wagdy was having Michael divert funds to his personal accounts, amounting to $1.3 million. In an attempt to make it seem like he did not owe any taxes, Wagdy orders his bookkeeper to remove certain transactions from the records. In 2017, both Wagdy and Michael were indicted on multiple charges of tax evasion. In 2019, Wagdy was found guilty of all charges against him and sentenced to 5 years in prison, 3 years of supervised release and $3 million in restitution. In spite of Michael’s lawyer trying to pin everything on Wagdy, Michael ends up convicted on one count of filing false corporate income tax returns and is sentenced to 40 months in prison, 3 years of supervised release, and just over $2 million in restitution. Sadly, Michael was diagnosed with stage 4 kidney cancer and was granted compassionate early release. Additionally, Wagdy himself passed away while in prison at 79 years old.

Talking Points

• The IRS finds that from 2001-2012 Hawaii Pacific Finance was used to divert approximately 1.3 million dollars into Wagdy’s personal accounts 

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This episode unveils the beginning of the story of Wagdy Guirguis, a garbage man turned jailbird whose career took such a trashy turn that he even took his CPA down with him. Wagdy owned multiple business entities, one of which was GMP Associates. Right from the beginning when he founded GMP Associates in 1999, he began to perform payroll tax evasion. When the IRS realized he was stealing from his employees, they added over $800,000 in trust fund recovery penalties to his debt. In 2003, Wagdy decided to hire a CPA named Michael Higa to be the financial controller for GMP, making Michael a co-conspirator to his tax crimes. Dom and Tom return to talk about the importance of being extremely careful of what responsibilities you agree to as a tax accountant, the financial and legal consequences of betraying clients’ trust, and what ended up happening to Wagdy and Michael. 

Talking Points:

• In 1999, Wagdy creates GMP Associates and starts committing payroll tax evasion, effectively stealing from his own employees

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This episode tells the second half of the story of Steve Martinez, an IRS employee turned con artist who committed fraud and tax evasion, and even attempted to hire someone to murder witnesses against him. Martinez made outrageous requests to the court, including asking for permission to go on a Disney cruise with his family, and later claimed he had Asperger's syndrome to avoid responsibility for his actions. He was ultimately sentenced to 24 years in prison and ordered to pay $14 million in restitution. Dom and Tom are back to discuss the consequences faced by Martinez's friends who had signed his bond, including foreclosure proceedings and legal fees.

Talking Points:

• January 2012, Steve’s ankle monitor is removed and he experiences freedom on a Disney Cruise with his family. He decides he’s not going back to jail at any cost, even if that cost is murder.

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Today’s episode reveals part one of the incredible true story of Steve Martinez, a former IRS agent and CPA turned con artist. Steve ran an intricate scheme committing tax evasion on behalf of both himself and his clients and defrauding his clients of millions of dollars. He created a dummy business which he used to embezzle his client’s tax return payments to the IRS while also filing false returns on their behalf. He then committed personal tax evasion by not reporting his illegally gained income. In 2009, Steve realized that he was being investigated and started defrauding even more people, using that money to pay off previous victims. He also tried to amend his tax returns to account for some of his unreported income. In 2011 he was finally arrested, but he managed to convince two of his clients to help him post bail. The conditions of his bail included restrictions like a strict curfew, GPS monitoring through an ankle monitor, and the inability to leave San Diego. Then things got even more twisted. Steve’s brother bought tickets for the whole family to go on a Disney Cruise, something that would require the conditions of Steve’s bail to be amended. They argued in court that this trip was for the benefit of Steve’s autistic son and that the ankle monitor and curfew were impacting Steve’s ability to be with his family. Shockingly, the court actually agreed to adjust the terms and Steve got to take a Disney Cruise while under indictment for stealing millions of dollars from his clients. 

Talking Points: 

• Steve’s dummy business, EFTPS, used to embezzle his client’s money and commit tax evasion on their behalf

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Today’s episode is the exciting conclusion of the true crime tale of J. Douglas Jennings, the con artist television taxman of San Diego. He was involved in tax planning and ran a faith based practice, using religion to trick clients into trusting him. In the last episode, we learned about Doug Jennings’ most well-known case wherein he schemed an elderly client out of 3 million dollars and was subsequently disbarred. In spite of this, Doug and his wife, Peggy, kept up their criminal activities for a total of 25 years before being sentenced to prison for bankruptcy fraud and tax evasion. Over this 25 year period, Doug continued to get into more and more debt, hide valuable assets, and defraud several banks. In the end, Doug had racked up over $25 million in debt to creditors and individual investors. He was sentenced to 34 months in prison, while his wife was sentenced to 4 months and ordered to pay $1.5 million in restitution to JP Morgan Chase.

Talking Points

• 2013 Louise deCarl Adler, a bankruptcy judge, charges Doug and Peggy with embezzlement and or larceny in connection with fraudulent intent on a transaction

Quotes

• “He ran a faith based practice that ended up being caught and sued more times than Lindsay Lohan.” (0:34-0:40 | Dom) 

Today’s episode reveals the true crime tale of J. Douglass Jennings, a real life knock off version of Better Call Saul. This con artist television taxman of San Diego managed to completely fool the public as he betrayed his clients’ trust through embezzlement, professional negligence, tax fraud, and malpractice. He attracted potential clients through a faith based pitch while lying about and strongly exaggerating his credentials and capabilities. In spite of having been sued more than 15 times, found guilty in court on 10 charges of misconduct, and legally disbarred from practicing law, J. Douglass continued to run his tax consultancy business.

Talking Points

• TV & Radio Tax Attorney Frauds Local Folks

Quotes

• “J. Douglass Jennings, the attorney who will enter business transactions that will be harmful to your career, livelihood, and mental well-being." (19:37-19:46 | Dom) 

Today’s episode reveals the curious case of Larry Couchet, a once well-respected CPA in Ohio whose retirement was derailed by tax fraud. Larry was the president and majority shareholder of an accounting firm in Ohio and had a great reputation in his community. He was 59, nearing retirement, and all was well until he began helping his clients file false personal income tax returns. This went on from 2006 to 2010 until the IRS got involved. In May of 2014, the IRS charged four members of the Field Group, Larry’s clients, and by extension indicted Larry as well. In spite of being charged for tax crimes and sentenced with 12 months and one day in prison along with a lengthy supervised release and fines, Larry is back practicing as a CPA after reinstatement to practice. 

Talking Points: 

• Larry Couchet and his career prior to getting involved in tax fraud

Quotes

• “You cannot write off your federal taxes on your federal income tax returns.” (10:03-10:09 | Dom)

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Today’s episode unveils the moral failures of an accountant turned criminal. Paul Henri Harleman was a contract bookkeeper in Hawaii who used his personal relationships to defraud his clients out of over 1.2 million dollars over a four year period. Paul started off with a fantastic reputation as a guy well trusted by his clients. It all changed when he became greedy and decided to deceive his clients, many of which were small business owners and nonprofit organizations. He opened up an LLC called Pacific Media Group, named as such because it was similar to the name of one of his client’s vendors. This allowed him to charge his client’s credit card and divert the money into his LLC’s bank account. Once his initial scheme was successful, Paul was emboldened to take it even further, committing 6 counts of wire fraud and 8 counts of money laundering before finally being arrested.

Talking Points:

• The story of Paul Henri Harleman and how he used his intimate knowledge of his clients’ businesses and accounts to defraud them for years undetected

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