Matthew Cox | Inside True Crime Podcast - $8,900,000 Tax Scam Gone Wrong!

Episode Date: July 4, 2024

$8,900,000 Tax Scam Gone Wrong!

Anyway, so I remember when I was talking to him, and this is where the whole kind of like it had evolved. Like he was like, and I remember just sitting there, it was me and a couple other guys and we were talking to him. And they were like, yeah, this is a pretty good scam, right? God, what are thinking? I was like, you're an idiot. As we're, he was like, well, what would you have done? And I want what I have done. He said, I would have.

Hey, this is Matt Cox, and it's me and Zach. And we're going to be, we actually got a, we actually got a, I almost knocked that over. What if I had knocked this over right now? Twice. You've almost knocked it over twice. I know this is an issue. So I get all jacked up. So what happens is we had a, we've answered a bunch of questions from viewers.

And one of the questions was, are there any scams that you learned about or came up with while you were incarcerated? And the answer is, you know, it's yes and no. But one of the big scams right now, and we both kind of have, we've talked about this and Zach's actually done the scam. It's called the tax scam or the drop. But that, I've actually have kind of a story of evolution on that scam because it was super prevalent 10 years ago. It's not so much now. But anyway, I wanted to, but I have seen different variations of it from guys coming in prison. But you want to tell how you were running the scam before you were incarcerated.

Right. Well, what had happened was, you know, my wife and I, we were doing a lot of different scams. And someone approached us about, well, what we needed was bank accounts. So I had put out the word that I need someone with a bank account because we want to use their bank account. Well, a friend of ours said, I have a girl that has like four or five bank accounts. I'm like, awesome. So he goes to introduce us to her. Her name was Tiffany. And when Tiffany and I met, it was like I was on one thing and she was on something else. So when I met up with her, I said, okay, if you have a bank account, you know, I'm going to, I need your debit card, right, and the account number and routing number, and I'm going to deposit this in your account, and then I'm going to do this with it and we're going to make this money. We're going to split it. So she's like, well, I really don't have an account open with a debit card.

And she's telling me, but what I normally do is this tax scam. I'm like, yeah, but I'm kind of focused on getting this. you know, this debit card thing gone, going. She goes, yeah, but when I do the tax scam, I can normally get about $13,000. I get about $10,000 federal and $3,000 from the state. This is up in Georgia.

I'm like, yeah, but I'm kind of focused on doing this. Do you have an available account or not? You're discarding her. Right, right. So we're like, we're talking against each other. So she's like, well, I have this one, but I have to check and see what the PIN number is and if it's still open. So she gives me a debit card.

So we part ways, and I tell the guy that sent her, I go, listen, she's on something else. I'm on A, she's on B. So she's on something else. So I don't even know if I can ever use her. Right. So about a week later, I'm laying in bed with my wife and like, it hits me. I'm like, that girl said something about making $13 doing taxes. 13,000. 13, yeah, $13. I've been out too long, buying from Burger King. But she said somehow I'm making $13,000 doing taxes. I'm like, she said she knew how to do everything. I'm like, why didn't I ask her about that?

So I try to call. This is the funny part because I try to call her and she doesn't answer. So I spend the next two days calling her about five times every day and she doesn't answer. So I have a back then I had a spoofing service where I could call you and make it look like. it was coming from another number right so I had her home number and her cell number so what I did was I spoofed her and made it look like I was calling from her house do you know she answered like I called her and she didn't answer I called her and she didn't answer so then I spoofed it and made it look like I was calling from her house and she answered on the second ring so when she

answered I just disregarded the fact that I spoofed her right and I said how come you ever been answering the phone when I call she goes oh Oh, I've been tied up and whatever. Cut them on. So I said, well, you mentioned this tax scam. Tell me what it is you need and how it works. So she's saying basically all she needs is someone's social and birthday and a bank account and she would file taxes for them on their behalf and it would be deposited directly

into the bank account. So I'm like, I go, I've got about 10 or 12 people that have their social date of birth and bank account. She's like, well, oh, my God, we could make $130,000. I said, well, cool, because I said, we'll split it. Well, whatever you do, I'll give you half. So she said, well, right now I'm kind of hurting for money. I don't have internet and such and such.

But I spent the money. I got her one of the, what is it called? Where you can use the internet anywhere. Hot spot. I bought her a hot spot and a laptop. So I gave her like $3,000. Got her a hotspot laptop and said, okay, do you have everything you need to file? them. So she began filing the income taxes. And lo and behold, about two weeks, three weeks

later, they 13,000 started coming in religiously, blew my mind. Because when I told my wife about it, she's like, you think it's going to work? I'm like, I don't know, but she's going to do it. So after she did it and they started coming in, then I got very interested in it. So But then I wanted to meet with her to see exactly what she was doing. I got the outlay of how much she said she was making, how she got the EIN numbers, and how she was just basically inputting it in and filing the taxes and the money was coming back. So it's as easy as just putting the paperwork in and they bring the money back. That's how it was back in 2006.

Right, right. So basically, I'm not sure this was very clear just for people that are watching is essentially what's happening is some guy works at Walmart, right? Right. And he makes whatever, let's say $40,000, $50,000. He's paid into the IRS $15,000 in income tax. Right. Now at the end of the year, he files his taxes and he might get, because he does it legally, he might end up getting $3,000 or $4,000 back. Right. Well, what people do is they'll get his information. And before he can file his income tax, somebody will get his information, file a tax return for. him with an alternative bank account number. And so the IRS, and he'll say like

I have six kids. I bought a pre-ez. I have a house. He'll say all these things so that he gets back the maximum instead of the $15,000, the $3,000 he would have typically gotten back. He gets $10,000, $9,000, $13,000, whatever. He gets that. From the feds and

state. Right. Well, there's no in certain states. Yes. I'll say he gets back $9,000. dollars, and the IRS direct deposits that money onto a green dot card or onto, typically into a bank account or whatever. And so suddenly, so all you have to do is you get the guy's information, you then file, and then, of course, it's a problem for him because then two weeks later he files his taxes. He doesn't know what's happened.

The IRS says, wait a minute, we just gave you your money. And now there's an issue. He has to file and say, hey, it was stolen. That's not me. That's not my number. I don't have this. I don't that. So that's an issue.

So, but they call that the drop because they're waiting for the money to drop, I think, right? Right. It takes about three weeks in the tax season. For it to drop. So at that time, now it's way behind. I mean, it's way behind because like I'm supposed to get money back. And I filed mine months ago. I've never got my tax return yet.

Still, it's way behind. So, but back then, if you file actually, they're false tax returns, they're getting money back. So Zach was doing that and he was doing that with this girl. And now, when I went to. prison, I met a bunch of guys. I actually met this one guy who got 15 years. His name was Russell Simmons. No relation to Russell Simmons. Oh, that makes sense. I thought it was the same guy. So this guy's name was Russell Simmons. And I remember he was there for fraud. He got 15 years and we had been talked. We talked a few times. And I went to him and I said, everything cool?

Oh, sorry. I went to him and I looked and I said, hey, so you were doing the drop? And he goes, yeah, yeah. I said, well, how's it, how's it work? And I remember he rambled through it real quick. I was like, I said, listen, I seriously want to know how does it work? Like not the quick cursory version that you give all these guys to impress them. Like, how did you even get on to it? What's the story? And he was like, all right, all right.

He said, so here's what happened. He owned a, he had started a car dealership, and he'd been running it for like 10 years. And he said, one day a guy. And he goes, it was in a bad neighborhood, a bad area. And he said, so I was buying cars for $2,000 at the auto dealer or at the auction, auto auction. He said, I'd buy them for $2,500, whatever. So on the average, they'll buy a car for like $2,000.

They'll clean it up. They'll sell it for $6. Right. Some of the cars get lost and they never get payments on them. But some of them, they get paid back, whatever. So you're basically buying a car that's worth $2,000 to $3,000 for almost double. Right. So he's buying them for two, cleaning them up, selling them for six.

And he said, people make payments to me. And they typically give him 2,000 down. So they basically cover the amount of money, most of the money they've got in the car. And they would come in. And he said, you know, and they buy cars. He goes, well, I've been doing that. And I've been doing okay. He said, but one day this guy comes in and, like, I had a nice, like, escalate or something.

He goes, it was pretty old. He said, but it was decent. He said, and that, it was going for like 10 grand or something. And he says, and he bought it for like three. And he said, and I remember when he bought it, he said, He didn't think he would even, didn't even know he could get rid of it. Right. You know, he said, because people just aren't buying cars for that.

And he said, I'm trying to sell up for 10. And the guy came in and was like, look, I'll buy it cash. Can I buy it cash? He's like, how much cash can I give you, like without you telling on me? And he was like, I mean, you can give me up to $10,000 cash. Like, it's not going to be an issue. You're not going to file any forms. He's like, no, I'll just take the money.

So he pays the guy. So then he said, no big deal. The guy takes the car. He's great. He said, didn't argue about the price, nothing. He said, then, like, another guy comes to me two weeks later, wants to buy a car that an expensive car I had in the lot. And the guy was like, whatever, it's like, you know, like, whatever, X amount of dollars.

And he says, look, how much money can I give you cash? And he's like, huh, so he takes it. He says, well, I start buying more and more expensive cars to the point where now that my cars are selling for $15,000, guys are coming in saying, how much money can I give you in cash? And so he starts structuring. It's called structuring. He's like, look, you can give me $9,000. I'll give you, I'll hold the note for the extra $6 grand, come in in a month and pay it off.

Right. And then I won't have to report the money, you know, or probably still does, but he doesn't. So the guy comes in and does that. So he said, man, he said this went, my cars started going from selling cars for $5,000 and $6,000 to where I was selling cars for $25,000 and $30,000. Wow. So now he's not buying these little $1,500, $2,000 beaters. He's buying cars that are for $10,000, for $10,000. He goes, guys are coming in left and right with cash, cash, cash.

So finally one guy had come in, like, bought like six cars or four cars or a bunch of cars in like two, three months. Right. And he said, so he comes in and he says, look at him to buy, I want to buy that car out there. And he looks at him and he goes, I'm going to sell you the car, okay? He goes, can you do this? Can you do that? Yeah, yeah, I'll do exactly what we did before. He goes, but here's the thing.

He said, man, where's this money coming from? Like, it's just you and me. Tell me the truth. He goes, this is like, this is drug money, right? I mean, this is the projects. I'm near them. There's projects all around me because this is a drug money, right? And the guy goes,

nah, man, he goes, ain't nobody's selling drugs anymore, Russell? Nobody's selling drugs? He goes, this is fraud money. Hey, real quick, just wanted to let you guys know that I have a book, my personal story. It's called Shark in the Housing Pool, and maybe Colby will put it up or not, I don't know. I also wrote a book about my buddy mine in prison.

His name is Walter Rossini. and it's called Devil Exposed. I also wrote a book called The Program about me going through the drug program in prison. It's practically a cult. And my favorite is Bent about John Boziak being a homeless kid on the streets of Miami that ultimately was one of the most prolific counterfeit

counterfeiters of credit cards in the cyber underground. So check the links in the description I'll have a link to every single book and back to the podcast. So Russell says to the guy, you know, just tell me what's going on. What's happening? The guy says,

okay, here's what we're doing. You know, he says, you know, we're getting information. And back then when Russell was doing it, by the way, Russell said, like, this guy was going around to women in the projects who didn't have jobs. Like, they're just in the projects. They've got three or four kids.

They don't have jobs. At that point, he said, this guy was like, he would buy for like a couple hundred bucks. He'll buy your information. The girls would give them the information. He would then file, these guys were filing on welfare recipients. Like they didn't even have to have a job at Walmart or Target or wherever they're working. You know, they don't even have to have a job, period.

And they're filing. And he said, and this guy is getting the money. He's putting it on green dock cards. Like at that point, it was so open. So he basically, he sells a guy out of card, he starts working with this guy. Right. Because, by the way, Russell has tons of people of social security numbers and information, people that have jobs, people that he's got tons of stuff in the files. So Russell starts working with this guy, but Russell was like, I really didn't want to do my own people.

So he does cherry pick a few of them. And over the next year or so, I forget how many millions of dollars he ends up getting. Right. But it's, it's a ton. I mean, it's enough to get 15 million. on a non-violent crime for a guy that had never been arrested before. So, oh, my God. Well, see, here, this is the actual, yeah, you could, if you wanted to, Colby, you could actually pop the video, because there's actually a middle dish, you know what I'm going to do?

I'm going to send this to you. Yeah. There. So I'm sending it to you. This one, it's where Russell Simmons got arrested. Gosh, this goes on and on. I forget what, how much is the actual? fraud oh he got refunds for is it attempted to make claims for 8.9 million dollars he got

refunds a refunds totaling one million basically a little bit over 1.2 million that's all he got so what what he ended up saying was this is that he said not like not all of them came in like you'd apply but they wouldn't all come in and and by the time he started doing it, the IRS, it was becoming rampant in Tampa, and the IRS started cracking down. Like one of the things, first they went to the IRS and they said, look, all these green dock cards, if money's going to this bank, don't do it. Don't send it to them. Remember there was the Russell Simmons card? Yes. Well, anyway, this obviously different Russell Simmons. So he said, like they started shutting down these prepaid debit cards. They would stop letting you put them on that.

really that hurt it then they started shutting down like different types of banks then they started telling people giving people pin numbers like you'd you would put in your thing you worked at FedEx and you'd send in your taxes and get it back in the neck and then you'd end up getting a something in the mail saying hey next year use this pin number so it and it was so funny about Russell's he was like I would call like they would send me something back and they'd say we're not putting the money on the card you have to call us he goes most guys don't call he would call and get them to do it yeah yeah he'd get them he'd get on the phone say what's the problem well we have some questions keep in mind he had a lot of their information right but he also said

like i think he started going to different he knew other car dealers and he would go to other like they were you know these these small car dealers he would go to other guys he knew and get information from them and he started buying information from people that would bring him hey i got this many social security numbers and copy of this company and he'd do that so he was doing it for a while so anyway Obviously, they got him for about $1.2 million. Right. And he came to prison. He got 15 years.

So he and I were talking. That was one thing that was interesting about the whole tax scam. Right. But here's what the drop. So here's what got me really thinking, wow, this is amazing. Is that, okay, so I started talking to these guys that said when they first started doing it, they would file 10 tax returns and they'd get eight of them. Right.

Towards the end, they were like, we're filing 20 and getting one to go through, maybe two. It was that bad. Well, I talked to this one guy. This was the scam I think I've told you about. First of all, I don't remember the guy's name. I wish I did. He was such an idiot. And I remember everybody that talked to this guy was like, how did he pull this off?

He's an idiot. Right. So what he did was he knew a guy that had filed like, whatever, he'd filed, he'd done the drop several times. He'd done several these tax scams. And he was like, first of all, this guy didn't, he didn't know anybody that, like, he couldn't, he didn't have anybody social, he didn't even know, couldn't even figure out how to get someone social security number. So he thought, I'll do it on myself. So what he did was he actually opened up a corporation in his grand, in his dead grandmother. name.

So he opens it up one year, like, let's say in December. He waits till, so then the next year goes by, he waits. The whole year. So he opens up December. Well, somehow or another, he opened up. It was only a few months later. So let's say he opens up, I don't know when it was. September and then January.

Yeah, and then a few months later, it's now it's January and new year. So he then goes to a bookkeeper, and he says, look, the company made this. much money. Okay, the company made whatever, $400,000 or $300,000 and the company paid me $200,000. And they withheld taxes for this much money. So I need you to file taxes for the corporation. So the bookkeeper asks a bunch of questions and says, okay, and files the taxes. This is obviously simple because you wanted some receipts, wanted this, but a lot of times,

like if it's just a bookkeeper, like a bookkeeper put down whatever you want them to put down. Because you're signing it. I'm preparing it, but you're signing it. I'm not saying this is legitimate information. So he explains the whole thing to the bookkeeper. She signed, or I'm sorry, he signs for it, sends it in. So he tells the IRS, the company made $400,000, the company paid him $300,000.

The company withheld $50,000 or $40,000 in taxes. So he, once it's filed, they file it, he then turns around and he files his taxes to the IRS. and says, I worked for this company. They withheld $40,000 in taxes. You guys owe me $25,000 in an income tax return. My income tax return, $25,000. Like, he puts down all this stuff.

I had a, I got, what do you call it? What are this? Solar panels. Right. And I'm driving a Prius. And I'm driving. Like, he, everything you can do. get he said if for a tax return like I bought a new car you're there's a tax credit for that this

year and there's this and there's that he does everything he gets a check and he said literally i sent it in within a week or two bam 25 grand he was like it was amazed well he said he made 400 but anyway go ahead yeah what no he said he made the company made 400 000 he said the company paid him 200 and withheld 40,000 and gave him back 25 okay whatever somehow or another they thought that was reasonable? I don't know. So that was, that was, that was his, he was there for, for, for, um, he was there for wire fraud against the United States government. I remember that was his charge. Like, that was like the charge they hit you with. Um, like, and it was also tax fraud and some of the charge. So he got that. I also remember he had my same federal judge. He and I had the

same federal judge. Oh. Yeah. And, uh, like, and he, and he, and he knew all kinds of stuff about my judge that I was like, like, like, he was like, oh yeah, I looked into him. I was like, why? Like, what does that change? you know so it's just kind of an odd guy but he wasn't that sharp right anyway so he did that scam and then the next year but and nothing ever happened so he opens up like another corporation or no no or i think he does the same corporation several years in a row then he opens up another corporates so the next year he says that the corporation by the way when he sends in the money for the or when he sent in the taxes for the corporation he got on a payment plan like he told

the IRS, this is the corporation and it withheld this much money from this employee. And then it tells the IRS, we plan on paying you back and you send in like a payment plan. Right. Next year he files for the same corporation having

never... Had a payment plan. Never sending in any money. Never doing anything. Right. So he then files again with the IRS. Says that the company paid him 500,000. The company made a million dollars paid him in four or five hundred hundred thousand dollars and they owed him

eighty thousand dollars or something he said they cut me a check just like that so they cut him another check so he he would take the paperwork he would get a tax um like a CPA to file it so he would actually do their bookkeeper right bookkeeper to actually file his tax paperwork which he'd submit to the IRS yes so now it's in their system right so when he's that he owes or paid that much money in taxes that the corporation did the corporation so a corporation has nothing to do with him, just told the IRS, I paid him. I paid Zach $400,000 and I withheld $100,000 in taxes that I owe the IRS. Right. And we're on a payment plan to you. Here's our payment plan, but then he never fulfills that. He never makes one payment to the IRS.

He also tells the IRS that the company owes X amount of dollars. Like the company also owes you this much money, and here's a payment plan for that. Never files. does it for like a couple years in a row. I mean, I'm getting some of the details a little off, but a couple years in a row. Then he closes that corporation. Well, he just stops. Right.

He just puts it aside. He, by this point, he's opened another couple corporations. So the next year, he does it again. He did this for about five years. One year he said he paid himself like one and a half million dollars. Like this corporation opened up in like his dead grandmother's name. Yeah. File.

Yeah, in his name. He's doing all this in his name. He's an idiot. Yes. One, they paid $1.5 million in, paid me $1.5, and they owe me, and they withheld $400,000, and you, the IRS, owe me $350,000 in, and they've paid him. Right. So, signed it himself, everything. This guy ends up with, like, it was like I got like a million dollars or something over the course of like five years.

Right. It's ridiculous. So what ends up happening is he then stopped for several years, by the way. So he stopped for several years. So he's made a few hundred thousand, so he might be all right. No, he's made like almost a million dollars or so, like a million dollars. He then stops for a few years. Now, what actually, he found out this later, that the IRS actually at one point

investigated one of the two companies. They actually went and investigated the company. But they couldn't get a hold of anybody. And they noticed that the company had paid him for like two or three years in a row. I forget what that in the amount. Yeah. pay and but here's the whole thing we can't get in touch with the company so we have to assume the company did pay you so the company did pay this guy this much they're admitting that and the

company never paid us the IRS the withholdings tax right and then now we can't get in touch with anybody at the company and you know what that happens right they can't hold it against you the employee now the company's admitting that they paid you right this is clearly a badly managed company doesn't mean we don't owe you the money They withheld it. They were supposed to send it to us. They didn't. So if you work for Walmart and make $50,000 and Walmart withholds $20,000 and then never pays the IRS the $20,000 they withheld to you,

and then you go to file your taxes at the end of the year and say, hey, Walmart withheld $20,000 from me. And now I'm filing for my tax income rebate and I need $7,000. The IRS can't say, no. They never paid us. Right. Well, no, no, no, no. by law, I have to allow them to take the money out. Yes.

It's not up to them. That's between you and Walmart. You owe me the money. Yes. Because the IRS is presuming everyone's operating on good faith. Right. So this guy does. Now this guy stops for a couple years, by the way.

But money gets tight. So he files again. Only now he's told a buddy of his about it. So his buddy, his buddy, he convinces his buddy to do it too. Right. So he and his buddy. you like work on work for the same company i think it's the same but might have been two different companies but they they file they then both filed to the irs hey the company made three million

dollars the company paid me a million dollars the company paid him 900 000 he gets a check back from the i what he files his tax return he gets a check back for like 200 300 000 the main guy gets a check back for like 600 000 or something like that well what happens is his buddy he tells him look put the money in the bank don't take any money out in cash like keep it there they're not going to come get the money because at this point he's super emboldened by it that he's been getting away with it he doesn't know that they ever even investigated he thinks he's found a loophole he thinks he's brilliant he thinks he's brilliant and stumbled on to something because he's an idiot um and most idiots think they're brilliant most smart people don't think they're that smart um so

right good observation yeah observation so uh what what ends up happening is he he so he his buddy puts the money in the bank and i mean almost immediately blows through all the money. He buys, I remember one thing they told me he bought, because I always remember thinking, why would you buy that? He bought an RV for like $200,000 or something like that. I don't know. I didn't understand that. I was like, well, what's he, what's, I'll never wanted to buy an RV. Like, I don't know, like maybe he was thinking, well, worst case scenario, I can live in the RV. No, it's titled. They're going to take it. So he buys, he buys this RV, and then he went out immediately after buying the RV and starts taking out cash.

well the bank says this guy one has never had more than a few thousand dollars in his account at any one time for the last five years he just got a check for 250 or 300,000 whatever it was he immediately spent 200,000 the rest he's actively coming in taking it out in cash and we noticed that the money came from the IRS and guess what the IRS there's a lot of scams going on with the IRS so you know what we're going to do we're going to call the IRS they notify the IRS the IRS looks into it the IRS comes they grab his buddy his buddy immediately says Oh, my God. I didn't know.

It was my, it was, it was, it was Tyler, Tyler did it. And he tells on Tyler, or whoever the guy's name is. I don't remember his name. He tells on him, they come and they grab him, he gets arrested. Here's the great thing, what always killed me. Tyler, like, only got hit for like a million dollars or something like that. Only like half a million or a million. You know why?

Right. Because the statute of limitations, because he had stopped for two years, the conspiracy stopped. So they could only go back three years, which was what he had currently done. Right. And the two years, had he never stopped doing it, they could have gone back like the entire seven or eight years that he'd been doing it. But he had stopped. So the conspiracy stopped. That was a new charge. Right. And because it was over three years old, they couldn't get him for the million dollars he'd already scam the IRS out of. So he got lucky. And I remember thinking, I think that somehow I think that charge only carries five years also. Um, I think, I think,

they run those consecutive because I was locked up with people that had done it in prison and the maximum he said he can get his five years I mean I don't know he remember Russell Simmons got 15 I know I think they ran three of those consecutive we can we can look I can look that up and tell you well he um so this this guy didn't get much time either by the way this guy got less than three years and I remember he was the guy that told or Russell no no no the the for a limited time at McDonald's enjoy the tasty breakfast Your choice of chicken or sausage McMuffin or McGrittles with a hash brown and a small iced coffee for five bucks plus tax. Available until 11 a.m. at participating McDonald's restaurants.

Price excludes flavored iced coffee and delivery. Tyler, you know, Tyler, the guy that got told on. Like his buddy, I don't know what his buddy, probably got nothing. He probably gave back the RV, gave back everything, probably was some of a small, it was probably owed a little bit of money and probably got, you know, because he wasn't the, he wasn't the brains behind the operation. Right. So this guy, Tyler, you know, I don't forget his name. Anyway, this guy, Tyler, he ended up getting like, I forget, like 30 months or something. It was under three years because I remember it wasn't enough for him to take the drug program.

And at that time, you had to have, you had to still have three years remaining. Okay. So towards the end. 30 months, I think, is what you. Right. So he ended up getting like 30 months. He didn't have enough time. Bitched and complained the whole time.

They could have given me probation. Don't you love those guys? Six months. Oh, I got to do all this time. Yeah, talked about the judge and what a, what a scumbag the judge is. He could have this. I'm like, bro, you haven't like, you know? And not just that.

Here's what's really messed up. Like with the million dollars, he actually bought like three, some of the money he spent that he kept to cake, got to keep. Right. He spent, he opened like three subway franchises. So you actively have franchises out there that you're not going to do. Like, that's what the judge was pissed about. Like he didn't want to get back any of the money. So he's arguing with the judge, no, you can't charge me.

He's like, oh, you know, I know you got lucky. You know, okay, all right. Well, I can give you this. Right. Boom. So anyway, so I remember when I was talking to him. And this is where the whole kind of like it had evolved. Like he was like, and I remember just sitting there.

It was me and a couple other guys and we were talking to him. And they were like, yeah, that's a pretty good scam, right? God, we're thinking. And I was like, you're an idiot. What do you mean? He's like, what do you mean? Like, it was great because the IRS. they had no choice but to pay me.

I was like, yeah, but they had to pay you in your own name. Like, you're an idiot. Like you did this in your own name. He goes, yeah, but I knew it would be worth it if I did get caught. And I was like, worth it? How's it worth it to go to prison for? I guess he's talking about the five years. Oh, you mean like the million he got.

Yeah, he got millions and only had to do maybe five years. Listen, he got super lucky. Like if that had hit, they probably could have given them 10 years, especially if he doesn't want to give up the money back. Right. Well, anyway, he was desperately always trying to make himself seem super sharp. Like, I really looked into it and I did this and that. But if you talk to him for any length of time, you realize what an idiot he was.

And anyway, so as we're, he was like, well, what would you have done? And I want what I have done. He said, I would have run an ad in the newspaper. Right. for people, I would have said, you know, anything, free government money being given away or home loans or personal loans or Fannie Mae is now, you know, giving away, you know, $10,000, you know, loans to anybody who under the poverty line or whatever.

I said, I would have run an ad for $500 and 40 or 50 people would have called me and given me their information because they would have thought they were going to get some loan. Right. Build consolidation loans. Any kind of loan, car loans, government, FHA, any. FHA anything you run spend a couple grand and get yourself 50 people that give you their call up and give you their information right and he was like oh okay I see what would you do that what do you mean I said well then what I would do is once I've got all your information they're going to give it to you

on the phone because they think they're applying for a $10,000 loan for the federal government to consolidate their bills or whatever that you know good credit bad credit no problem like a same you know so you get their information then I said you could always go get a bank account in their name. Right. You go always go get a debit card. I mean, go get a, you could order their, their birth certificate, their social security card.

They're, you know, so I started naming off. And then you can go get a, go get a driver, an ID in their name. But, but you know, not everything is for everybody. Like, he seems like he stumbled upon this. And what you're describing is in depth and detail that probably is not something he'd be comfortable doing. I find that. I wouldn't be comfortable doing it in my own name.

Oh, yeah. I mean, that's the problem. Or he should have found some volunteers. That's what he, that this was his first attempt to distance himself. Right. Was to do it with this other guy. Right.

Well, not knowing, like, now that he knows the feds, I'm sure he's like, well, I need to get someone to do it in their name, but that person doesn't need to know who I am. Right. Right. Well, I mean, I was telling him, look, I would have gone out and gotten alternative people. Right. You know, and I would have.

and then with those alternative people, open up online banking accounts or get an ID online. Or you think about it, if you're just talking to somebody on the phone, that person on the phone, you can say, great, oh, you have a driver's license? Do you have a driver's license or an ID?

Oh, you have a driver's license in the state of Florida? Great. Can you go ahead and tell me the expiration date? Tell me the issue date. Tell me what's the driver's license number? You can then turn around and go on one of these websites and get a card issued to you. And if I have that information,

I can open up a bank count in your name. I don't even have to go in the bank. And you could have done all of this online, and then he could have taken that corporation, he could have bought a shell corp. Then filed for the shell corp on all 40 of those guys, saying these 35 guys made $80,000, $85,000, $87,000. You know, you vary it, obviously, on these guys. These extra six guys made, you know, $200 and something thousand. This top guy made $1 million.

Then you file for the corporation to the IRA. saying how much and how much the withholding was talk about the payment plan and then file on all of those guys and I would even vary that I would some of them I would file through um quickbooks some I'd file through turbotax right some I'd file directly with paper mail it in all the money would be direct deposit on all these different accounts with these debit cards that aren't green dot cards right that aren't those prepaid you know whatever Walmart cards like legitimate banks have that money deposited, withdraw all of those funds, and then take that corporation, and I would go and I'd file bankruptcy on the corporation. Because when you go downtown, when you go to the bankruptcy

court, you basically walk in there. You can actually pull it off online where you say, I'm filing. They give you a file number, and then you just fill out these documents and you mail them to your creditors. One of the creditors would be the IRS. So now the IRS is going to wait for the when is the court date going to be? And they'll even issue you a court date. Right. Would you show up for the court date? Hell no.

But it would, but you could, well, it's still, it, here's the thing. To the IRS, it looks like this is a corporation that is extremely, um, a legitimate corporation was opened. Right. They hired about 40 or 50 people. They took the withholdings. They filed their first year of taxes. For some reason, they, they could,

make their payments and they went into bankruptcy. Then they never finished the bankruptcy. That happens a lot. We owe all these people this money and they pay them. Look, at any given time in the United States, there's literally between 10 and 100,000 companies that are behind on their payroll withholding taxes. Right.

That's not an uncommon thing. There are some companies that are hundreds of, are like $10, $20 million behind on their payroll withholding tax. And that's natural for them. Right. And they get on. Some of them, I don't know if you know this, sometimes they can actually not pay their employees, withhold the money, then go to the IRS and negotiate what they owe the employee for the. I've seen that there's commercials for that. Oh, yeah. Yeah. Well, for a corporation for individuals, there's definitely those. Where I owe the, if you owe the IRS less than $10,000 or no, more than $10,000 come to us. They'll consolidate it. They'll talk to them. But that's common for corporations, too. Yes.

So you're telling me that I withheld a million dollars in federal income tax. Didn't pay it over the IRS. You guys then paid $800,000 back to the employees. And I can now go to you and say, look, I know I owe you a million dollars and negotiate with them to pay them $300,000 back. The IRS is half a million dollars in arrears. They're now in the hole. Yes.

And you're going to let me continue as a corporation. Absolutely. Like that happens. It's true. I know because I know guys that were in the process of doing that and the IRS got tired of it and just filed charges against them. But it does happen. It does happen. Because I know because the same guys had done it multiple times with different corporations.

So this is something that happens. The bottom line is that that's that way you're filed, that way the guy could have been filing 40 tax refund. The drop could have been filing 40 of them and gotten all 40. And the IRS wouldn't think those people had done anything wrong. they think the corporation had done something wrong and the corporation went into into bankruptcy and never completed the bankruptcy and that happens that's true I I think it wouldn't matter either or whether he did the 40 people or the if the same amount is true like um in my you think you could have done with like just two or three people yes in my experience of

of all the things that I was doing I've ran across some IRS checks that were like 190. I think the biggest one I saw was like over half a million and it was to a person. So I mean, I just think it's like it shouldn't be him, but he doesn't have to have 40. He could have six. And whatever there he claims to be making. I think there's got to be, it's got to be something to like going to a bookkeeper. I think you'd have to know how to do the books yourself. I think a bookkeeper would be like, you may what? Do you have any receipts? You know what I'm saying? Right. I'd be scared they report me. See, to me, like if it was, was me like i mean i literally for the corporation i would have a website i would make i'd manufacture

receipts i would have leases like i would do everything fraudulent to create the look that this was completely 100% legit that's what i'd bring to the bookkeeper like they would be like okay you spent how much and this and your bank accounts the the nice thing is i can fabricate all of that right so they would look at it and they would look at and they'd be like wow this is For the bookkeeper. The bookkeeper, because the bookkeeper would then file it, because I want the bookkeeper to be secure, right, and feel confident. But I'd also be like, okay, look, he had a website.

So that, you know, so that if the IRS ever looked into it, like, there is a website. Keep in mind, too. If I made, if you do the math on this and you make half a million dollars on these refunds, it's worth it to pay an attorney to file the bankruptcy. So now if the IRS goes, right. The IRS goes and says, okay, look, you're the attorney. I am the attorney. I talk to a guy three or four times and he mailed me this and he mailed me this and

mail me that. He never did mail me this or that. We never did end up going to court. He stopped returning my, he stopped returning my phone calls. I don't know what to say. Like the IRS has got to be like, yeah, that does happen. The IRS, what I don't want the IRS to be thinking is fraud. I want them to be thinking somebody opened a corporation.

They ran it for about a year. They couldn't pay their bills. they tried to get on a payment plan they hired an attorney they filed bankruptcy they never completed the bankruptcy because let's face it the guy's broke he's starting his life over

he just tried to walk away I know many people doing when I was doing mortgages and people were like I'd be like do you have a bankruptcy and they'd go well you know I started like I had more people start bankruptcy

than ever if I had them go through it like I had if I've talked to that's how long that stuff stays on your credit too right well if I talked to 50 people that said I, you know, about bankruptcy, like literally 40 of them were like, I started it. Well, what does that mean? Well, I started it and they give you these letters that you mail to your creditors. Well, the creditors stopped calling. And so I just never, I never followed through with it. What do you, you know, I was like, what do you mean? It was like, well, people stop calling. I stopped paying. And then after about three or four years, I started getting credit card offers. I started filling out the credit card offers and I got new credit cards. And I just kind of forgot about it. So I never completed it. Right. And you're, They're like, and they never came looking? No, because that's what happens with Capital One.

You owe $3,000. We got something in the bankruptcy court. They're waiting for the court date. Right. It never comes. Right. That allows them to cash the debt and write it off for profit and loss. Yeah.

So at that point, it just, and eventually the person doesn't do it because eventually it kind of falls off their credit. Right. It doesn't affect them so they don't follow through. And what was bothering them the most was the fact that they were getting these calls. well so it's the same for a corporation the guy that owns a corporation if the corporation went under and he's made no money and he's now claiming bankruptcy the lawyer's asking for more money right he doesn't have it he's like what am i doing like this is the corporations problem right i'm leaving i'm going to get a job at ford my corporation that i tried to open didn't work out it went under i had a bunch of employees i'm going to go work get a regular job yes and that's what happened so anyway like to the irs that would look extremely legit And then this guy could move on. They're not going to launch this massive investigation because this is common.

So I was explaining that to him. And I was like, that's what I would do. And he was just like, oh my God. I'm like, yeah, think about it, you could have a website, like everything about it that they could check. Phone numbers issued, website, everything. It would smell legitimate. Right. It's not hard to make it appear legit.

So, listen, we had that conversation multiple times. And he was just, he was like, God, man, I hate talking to you. Hate talking to you. And I was like, cover all angles. I mean, yeah. I mean, how many times did we sit around and just sit there and talk about scams over and over? Too many. But yeah, that was that.

And now we're out here talking about it. But the tax, like, you know what's something funny? The tax scam has turned into the PPP loans. Yes. You know, and then eventually, it's outrageous. Yeah, that was, that was in, I think, I think they just flooded the hoods with money. Yeah. I think they're just like, give all the poor zones some bread that they used to give rich people.

I don't know what the hell is going on. There's got to be another, there'll be another scam. Oh, yeah. There'll be another one. They'll be massive. They'll come in. There's always going to be these scans. Yes.

There'll be. Yes. Yeah, you're like, yes. Oh, yes. You got to start, you got to remember to talk into. Oh, okay. Sorry. Oh, yes.

Yeah, yeah. Yeah, it's always like that. You know, the another scan that was like that? that was like when the entire economy was crashing there were tons of people doing the they were doing refi scans or doing loan modification scans or doing wherever the government shot money that's what they did yeah they they jump all over it and come up with some kind of scam that's true are we what are we good you think because I am super sleepy yeah you're falling asleep oh rough night that's what we should be talking about We should be talking about your night.

Long night. I am tired. We should be talking about Zach's night. I should only do, yeah, well, that might have me awake, but I should only do two hours. All right. All right. Hey, if you like the video, do me a favor and subscribe. Hit the like button.

Make sure you turn on the notification bell. Share the video and leave a comment for the algorithm. This is Matt Cox signing off, and this is... Zach, saying bye. All right. See ya. I don't know. Wow.