Self-proclaimed ‘Tax Fraud Queen’ Rashia Wilson has been sentenced--again. Despite an appellate court's order to the trial judge to recompute her sentence, she got the same thing: 21 long years. It is an inglorious end for someone who taunted publicly on Facebook that she couldn’t be caught. When sentenced in 2013, she got 21 years for owning guns and stealing millions from the IRS.
She appealed, and an appeals court in 2014 struck down her 21 year term, rejecting that sentence on technical grounds. But the latest sentence showed that the trial judge would not budge on her 21-year term. The Tax Fraud Queen remains an inmate at Aliceville Federal Correctional Institute in Alabama. Of course, 21 years may not actually mean 21 years. With good behavior, she is scheduled to be released Jan. 5, 2031.
The original 21-year sentence was controversial, the appeals court finding procedural errors adding years to her prison term. That was why the trial judge was ordered to look again. Ms. Wilson's sentencing was complex because she was actually indicted twice in 2012. She pleaded guilty to illegal gun possession, and admitted netting over $3 million from aggravated identity theft and wire fraud in a tax refund scam.
The sentencing judge considered her prior conviction, the multiple felonies, and a formula that weighs the seriousness of the offenses and the defendant’s record. Ms. Wilson was hardly a discreet or modest criminal. She posed with stacks of cash, dubbed herself the first lady of tax fraud, and challenged authorities to catch her. She teased the police with online entries like this one:
“I’M RASHIA, THE QUEEN OF IRS TAX FRAUD… I’m a millionaire for the record, so if U think indicting me will B easy it won’t, I promise you! U need more than black and white to hold me down N that’s to da rat who went N told, as if 1st lady don’t have da TPD under her spell. I run Tampa right now.”
Investigators worked for years to gather evidence against Ms. Wilson and other fraudsters. The feds called it Operation Rainmaker. Wilson’s boyfriend, Maurice “Thirst” Larry was targeted, as was Marterrence “Quat” Holloway. But Ms. Wilson was the big catch. Before her coronation as tax fraud queen she had been arrested 40 times, with felony convictions for grand theft and burglary.
Even in prison she caused controversy. She was supposed to begin paying restitution to victims but pleaded poverty, claiming to that she earns a paltry $5.25 a month at the federal prison. She complained that she has to pay for her own vitamins and hygiene items. But the prosecutor’s found she had deposits of $2,914.43 over six months, allowing her to spend liberally for herself.
While incarcerated, Ms. Wilson is supposed to pay at least $25 per quarter toward the $3.1 million she and an accomplice owe the IRS for filing returns using stolen identities. Identity theft tax fraud is taken seriously. The average sentence for federal identity theft defendants nationally was 43 months. Many tax crimes carry less severe punishments.
In fact, failing to file a return is a misdemeanor, while filing falsely is a felony. Actor Wesley Snipes didn’t file a false tax return, but was convicted of three misdemeanor counts of failing to file tax returns. His three-year sentence could have been worse. In most cases the IRS must catch you within six years.
For criminal tax evasion, that statute doesn’t run if the taxpayer is indicted within six years after “willfully attempting in any manner to evade or defeat any tax or the payment thereof.” In some cases, though, the statute stops running. For example, the statute stops running if the target is outside the U.S. or is a fugitive. When the alleged tax crime is committed can be hard to pinpoint.
Does filing a false return start the six year clock? What about failing to file by the due date? How about covering it up later, hiding money, or lying about it? All are potential problems that might occur many years after the tax return was (or should have been) filed. That means you may have to worry for many years beyond six. Some courts have concluded that the six year statute doesn’t start to run until the last act of tax evasion.
In United States v. Irby, the court held the six year statute starts on the last act of evasion. Mr. Irby used nominee trusts to conceal his assets, delaying when his six years commenced. Years later, he could still be indicted, prosecuted and convicted. No one wants to be lying low, worrying about being caught. Even the Queen of Tax Fraud is probably aware of that now.
For alerts to future tax articles, follow me on Forbes.com. Email me at Wood@WoodLLP.com. This discussion is not intended as legal advice, and cannot be relied upon for any purpose without the services of a qualified professional.
