Brazilian Resident Pleads Guilty for Role in Fraudulent Tax Refund Scheme

A South Carolina man currently residing in Brazil pleaded guilty yesterday in federal court to conspiracy to submit a false claim.

According to court documents and statements made in court, Robert Xan Paul, 45, of Sao Paulo, Brazil, conspired with others to defraud the United States by preparing and submitting to the IRS a fraudulent income tax return that claimed a nearly $600,000 refund, which the IRS paid. Paul was a client of O.I.D. Process, a business owned by his co-conspirators that helped others prepare and file individual federal income tax returns that claimed fictitious Original Issue Discount interest income and federal tax withholdings, resulting in fraudulent claims for tax refunds.

To support his refund claim, Paul created fraudulent IRS forms from financial institutions where he had accounts. Those forms falsely indicated that the financial institutions had withheld federal income tax on his behalf.

In total, Paul caused a tax loss to the IRS of $595,110.

Paul pleaded guilty to one count of conspiracy to submit false claims. He is set to be sentenced on Jan. 21, 2025. Paul faces a maximum sentence of 10 years in prison. He also faces a period of supervised release, restitution, and monetary penalties. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

First Assistant United States Attorney Patrick D. Robbins, Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division, and IRS Criminal Investigation Oakland Field Office Acting Special Agent in Charge Michael Mosley made the announcement.

Assistant U.S. Attorney Michael Pitman and Trial Attorney J. Parker Gochenour of the Tax Division is prosecuting the case. The prosecution is the result of an investigation by IRS Criminal Investigation .