PHILADELPHIA – United States Attorney William M. McSwain announced that Omar Faruq, 37, and Omar Ali, 36, both of Pennsauken, New Jersey, were sentenced today by United States District Court Judge Nitza I. Quiñones for their roles in conspiring to file false tax returns while operating a tax preparation business in Upper Darby, Pennsylvania. Judge Quiñones sentenced Omar Faruq to 24 months’ imprisonment, three years’ supervised release, and restitution of $688,362; she sentenced Omar Ali to 18 months’ imprisonment, three years’ supervised release, and restitution of $573,322. Faruq and Ali must pay the restitution to the United States Department of Treasury.

Codefendants Faruq and Ali pleaded guilty in June 2019 to filing false tax returns on behalf of their clients at Omar Consultancy Inc., a tax service they operated with offices in Pennsylvania and New Jersey. In filing tax returns for their clients, Faruq and Ali consistently used false filing status, Schedule A deductions and expenses, Schedule C business income and losses, and fictitious credits to decrease a client’s tax liabilities, all of which resulted in increased refunds for many of their clients. Faruq and Ali then diverted portions of these refunds into their own bank accounts as part of the conspiracy.

“These defendants – professional tax preparers – committed fraud and stole from the United States government, while duping their clients,” said U.S. Attorney McSwain. “The defendants also stole from the pockets of all taxpayers who do the right thing every April and pay their fair share of taxes. With tax season approaching, these sentencings serve as a warning for anyone considering this type of fraud.”

“With this year’s filing season just around the corner, today’s sentencings are a good reminder of how important it is to do your homework when choosing a professional tax preparer,” stated John R. Tafur, Special Agent in Charge, IRS Criminal Investigation, Newark Field Office. “Taxpayers should be selective in choosing a tax preparer and have confidence knowing that person will prepare accurate tax returns and safeguard their financial information. Those tax preparers who choose to abuse our tax system will end up on the radar screen of IRS Criminal Investigation.”

The case was investigated by Internal Revenue Service, Criminal Investigations, and is being prosecuted by Assistant United States Attorney Richard P. Barrett.

PHILADELPHIA – United States Attorney William M. McSwain announced today that Omar Faruq, 37, of Pennsauken, New Jersey, and co-conspirator Omar Ali, 36, also of Pennsauken, New Jersey, both entered pleas of guilty before United States District Court Judge Nitza I. Quiñones on one count each of conspiracy to defraud the Internal Revenue Service, aiding another in the filing of a false tax return, and filing a false tax return.

According to a criminal Information filed in April 2019, Faruq and Ali conspired to file false tax returns on behalf of their clients at Omar Consultancy Inc., a tax service operated by them with offices in Pennsylvania and New Jersey.

According to the plea memorandum filed for today’s court appearance, Faruq and Ali consistently used false filing status, false Schedule A deductions and expenses, false Schedule C business income and losses, and fictitious credits to decrease clients’ tax liabilities, all of which resulted in increased refunds for many of their clients. Faruq diverted portions of his clients’ returns to his own bank account as part of the conspiracy, totaling more than $300,000, and Ali diverted over $170,000 to his own bank accounts. 

Faruq and Ali both also pled guilty to filing a false income tax return for themselves and their respective spouses for tax year 2014. In filing the false returns, Faruq and Ali omitted gross receipts from their tax preparation business on the 2014 tax returns and failed to report diverted funds from taxpayer-clients as income on their personal returns.

“Our tax system depends on the honesty of all citizens to truthfully file their tax returns, many of whom rely on professionals to represent their interests and to do the work honestly,” said U.S. Attorney McSwain. “Tax preparers like Faruq and Ali undermine the tax system when they prepare and file false tax returns for their clients. My Office will aggressively investigate and prosecute tax preparers like the defendants who profit by turning their tax preparation services into fraud factories.”

“While most return preparers provide excellent service to their clients, a few unscrupulous tax preparers file false and fraudulent returns to defraud the government, the tax-paying public and their own clients,” stated John R. Tafur, Special Agent in Charge, IRS Criminal Investigation, Newark Field Office.  “Tax practitioners and return preparers have a duty to their clients to prepare tax returns that comply with the law and are complete and accurate.  IRS Criminal Investigation will investigate and hold accountable abusive tax preparers who attempt to defraud our nation’s tax system.”

The case was investigated by the Criminal Investigation Division of the Internal Revenue Service, and is being prosecuted by Assistant United States Attorney Richard P. Barrett.