Owner of DC-Area Tax Preparation Business Pleads Guilty to Fraud
FOR IMMEDIATE RELEASE
Wednesday, August 18, 2021
Owner of DC-Area Tax Preparation Business Pleads Guilty to Fraud
Scam Involved Filing of False Income Tax Returns
WASHINGTON – Endalkachew Asfaw, 48, of Alexandria, Va., pleaded guilty today to aiding and assisting in the filing of a false tax return and causing at least $250,000 of loss to the Internal Revenue Service, announced Acting U.S. Attorney Channing D. Phillips and Darrell J. Waldon, Acting Special Agent in Charge, IRS-Criminal Investigation, Washington Field Office.
Asfaw pleaded guilty in the U.S. District Court for the District of Columbia. The Honorable John D. Bates scheduled sentencing for Nov. 17, 2021. The charge carries a statutory maximum of three years in prison and potential financial penalties. As part of the plea agreement, Asfaw has agreed to pay restitution to the United States.
“Our country’s financial system depends on honest and accurate compliance with the U.S. tax laws,” said Acting U.S. Attorney Phillips. “Tax fraud costs U.S. taxpayers billions of dollars each year, and this Office will vigorously prosecute those who commit tax fraud.”
“Tax Practitioners entrusted to prepare accurate tax returns should not lead their clients astray by falsifying returns prepared on their behalf. We will continue to investigate those who fraudulently prepare and file income tax returns, effectively stealing money from the government,” said Acting Special Agent in Charge Waldon.
According to court documents, Asfaw, a Certified Public Accountant in Alexandria, has operated Endalk and Yohannes Associated, L.P. with a business partner in the District of Columbia since 2011. From 2016 through 2019, Asfaw and the business partner prepared approximately 10,000 tax returns.
According to court documents, Asfaw knowingly aided and assisted in the preparation of false income tax returns for years 2015 through 2017 on behalf of his clients. Asfaw did this by deliberately overstating unreimbursed employee business expenses on his clients’ Schedule A deductions, including uniforms and unreimbursed mileage expenses. As part of his plea, Asfaw also admitted to creating fraudulent Schedule C expenses and deducting exemptions for individuals that his clients were not entitled to claim. Asfaw admitted to fabricating these items to generate larger tax refunds for his clients. As part of his plea, Asfaw admitted that he filed false tax returns resulting in a total tax loss of more than $250,000 to the U.S. government.
In announcing the plea, Acting U.S. Attorney Phillips and Acting Special Agent in Charge Waldon commended the work of IRS Criminal Investigation, Washington Field Office, which investigated the case. They also acknowledged the work of those who are handling the case at the U.S. Attorney’s Office, including Paralegal Specialist Mariela Andrade and Assistant U.S. Attorney Leslie A. Goemaat, who is prosecuting this matter.