BOSTON – A Lowell tax preparer has been permanently barred from operating a tax preparation business and ordered to pay $483,000 following allegations that he defrauded clients by filing falsified tax returns and pocketed the inflated refunds, Attorney General Maura Healey announced today. As Massachusetts residents begin preparing their taxes for the April deadline, the AG’s Office offers tips to those considering hiring a tax preparer.
A consent judgment, including the payment order and permanent injunction, was entered in Middlesex Superior Court today against Samuel M. Dangaiso and his unregistered company Tax Enterprises.
“This defendant filed millions of dollars in fraudulent deductions on behalf of his clients and pocketed thousands of dollars based on their falsified tax returns,” said AG Healey. “This tax season, we ask members of the public to exercise caution and contact my office about any tax preparation scams.”
“The Department of Revenue takes seriously its obligation to investigate fraudulent activity to protect the Commonwealth’s taxpayers,” said Massachusetts Department of Revenue Commissioner Christopher Harding. “With tax filing season in full swing, this judgment is a timely reminder for taxpayers to be cautious when filing their returns and to carefully consider tax preparers’ qualifications before engaging their services.”
The AG’s Office sued Dangaiso and his company in February 2017 after an investigation conducted by the Massachusetts Department of Revenue (DOR) revealed that Dangaiso was engaged in serial tax fraud and unfair and deceptive business practices relating to personal income tax returns in Massachusetts.
According to the AG’s complaint, Dangaiso filed hundreds of tax returns containing inaccurate information, including unjustified deductions, false bank account information, and fake dependents, without the knowledge or consent of his clients. Dangaiso allegedly used these inaccurate tax returns to generate inflated tax refunds that he directed to his bank account or a prepaid debit card, transferring the amount his customer expected as a refund and keeping the remainder for himself. The AG’s complaint alleged Dangaiso kept at least $150,000 of the funds generated by this scheme.
During the course of the investigation, the AG’s Office secured a preliminary injunction barring Dangaiso from continuing to serve as a tax preparer while the lawsuit was ongoing. In January 2018, Dangaiso admitted to violating this injunction and was ordered by the court to pay $30,000.
The permanent injunction prohibits Dangaiso from preparing and submitting state tax returns for Massachusetts taxpayers and orders him to pay $483,000. Under the judgment, any state income tax refunds Dangaiso may be eligible to receive in the future will be used to pay back the clients he defrauded, and further violations of the order would automatically trigger additional sanctions.
The AG’s Office and Massachusetts Department of Revenue encourage taxpayers to consider the following tips this tax season when choosing a tax preparer:
Consumers who are concerned that they may be a victim of tax fraud can call the Department of Revenue’s Tax fraud hotline at 1-800-792-5254 or 617-887-6780.
This matter was handled by Assistant Attorney General Brendan Jarboe of AG Healey’s Consumer Protection Division, with assistance from Lisa Dell’Anno and Bensen Solivan of the Massachusetts Department of Revenue.