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H&R Block Manager Charged in Identity Theft Scheme

Los Angeles (April 20, 2012)

By Michael Cohn, Accounting Today

The manager of an H&R Block branch in Southern California has been charged with using the identities of his former tax preparation clients to file false tax returns with the Internal Revenue Service.

Damon Charles Dubose, 38, of North Hills, Calif., was charged Friday with one count of wire fraud and one count of filing false claims with the IRS. He was arrested in late March by special agents with the IRS’s Criminal Investigation division pursuant to a criminal complaint and was released on bond.

Dubose, working as a manager for H&R Block in Van Nuys, allegedly obtained the personal identifying information of his former clients and prepared bogus tax returns in their names to obtain tax refunds and credits, according to documents filed with the court. He then allegedly then used H&R Block Emerald Cards to withdraw the fraudulently obtained refunds from automated teller machines.

Shortly before midnight on Feb. 12, Dubose was seen by a patrolman in La Canada, Calif., loitering near the ATMs of three banks. Dubose was wearing pantyhose over his face along with beanies and a scarf.  Inside his vehicle, the officer found six envelopes with a name and partial Social Security number handwritten on the outside, and an H&R Block Emerald Card on the inside.

The Emerald Cards allow H&R Block customers to access their tax refunds electronically like a debit card. Dubose’s vehicle also contained approximately $2,960 in cash and a printout of dates of birth and Social Security numbers that matched the handwritten information on the envelopes. Dubose claimed that the information was for his tax clients and he was authorized to make withdrawals on their behalf.

The Los Angeles County Sheriff’s Department obtained a search warrant for the home of Dubose’s girlfriend and found $6,900 in cash, six H&R block Emerald Cards, and the personal identifying information of more individuals.

Three taxpayers whose identifying information Dubose possessed were contacted by law enforcement. All of them said Dubose was not authorized to make withdrawals on their behalf or possess their personal identifying information.

Dubose allegedly transmitted the electronically filed fraudulent tax returns from Van Nuys, Calif. to Tennessee and West Virginia. His next court appearance is scheduled for April 30.

When contacted last month after Dubose’s arrest, H&R Block spokesman Gene King commented, “H&R Block takes this matter very seriously. This was an isolated incident and we are cooperating fully with authorities on the investigation of a former employee. The situation involves a small number of clients who have been contacted and informed of the steps the company is taking to help them and correct the situation.” Dubose declined to comment.

The Internal Revenue Service has come under increasing pressure to curb the growing trend of taxpayer identity theft. At a congressional hearing Thursday, IRS and Treasury Department officials discussed the steps they have been taking to crack down on identity thieves and flag suspicious returns.

 

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One Response to “How not to be a responsible tax preparer”

  1. Janice Coursen says:

    I had a big problem with that particular office, I took my parent’s taxes to the HR Block Van Nuys Office. Documents were sent directly to that office for my parent’s taxes. I returned the next year to get the taxes prepared and was told that they did not have my tax documents. I told them you prepared my parent’s 2007 taxes and I had the copies. Then they said they would get their database person to get the 2008 taxes back on line; they said my backup documents were in storage somewhere. I was told they would look for them.

    After several calls with several people, and back and forth chatter, they said they did not know what happened to my documents.

    Believe me I am trying to make a long story short. As a result of all of this, I could not get the 2008 taxes filed in time to get the refund. Guess who did my taxes? You guessed it, HR Block Manager, Damon DeBose.

    Nobody at HR Block ever told me that he was arrested for taking client’s tax information.

    I have an appointment for Monday, for them to do the 2008, 2009, 2010, and 2011 taxes.

    I had some problems with my parent’s checking account and I am wondering if Mr. DeBose had something to do with it.

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