MEMPHIS, Tennessee — Two tax preparers are facing serious legal consequences after allegedly submitting fraudulent claims totaling $65 million for various pandemic relief programs, according to federal prosecutors in Tennessee.
A federal grand jury has handed down indictments against Renata Walton, age 44, and Nicole Jones, age 36, on over 50 charges including wire fraud, money laundering, the preparation of false tax returns, and obstruction of justice, as detailed in a statement from the U.S. Attorney’s office in Memphis.
Both Walton and Jones, hailing from Olive Branch, Mississippi, entered not guilty pleas during a court appearance on Tuesday. They were subsequently released on a bond set at $100,000 each. As per court documents, there is no legal representation listed for them, and their tax preparation business, R&B Tax Express, currently has a recorded message stating it is closed “for the season.”
According to prosecutors, Walton and Jones applied for tax credits on behalf of their clients through two specific programs: the Employee Retention Credit and the Sick and Family Leave Credit. However, the clients in question were not eligible for those credits. This fraudulent activity reportedly resulted in clients receiving substantial tax refunds in the six-figure range, with Walton and Jones receiving hefty fees that they then laundered through various local financial institutions, as indicated in the indictment.
The Employee Retention Credit offers refundable tax assistance to certain eligible businesses that have employees and experienced difficulties during the pandemic, while the Sick and Family Leave Credit provides financial support to employers for wages paid to employees taking leave due to qualified reasons like illness or recovery from vaccinations.
Additionally, Walton has been accused of falsifying applications for the Paycheck Protection Program and the Economic Injury Disaster Loan, requesting assistance from the Small Business Administration without proper legitimacy.
The indictment highlights that Walton and Jones filed fraudulent claims with the intention of obtaining more than $65 million in unearned funds. They were reportedly aware that federal investigators were looking into their activities but persisted in submitting false tax returns. Furthermore, Walton allegedly advised her clients to refrain from communicating with agents from the Internal Revenue Service, further complicating the legal situation.