Sean Aude Gallman, Mail and Wire Fraud, Maryland 2016

Tax refund scam

Greenbelt, Maryland – Sean Aude Gallman, age 39, of Upper Marlboro, Maryland, and his brother Eric Maurice Gallman, age 42, of Huntersville, North Carolina, pleaded guilty to a conspiracy to commit mail and wire fraud, mail fraud, and conspiracy to commit money laundering, arising from a scheme in which they filed 30 fraudulent tax returns seeking refunds of over $218 million. Sean Gallman also pleaded guilty to aggravated identity theft and money laundering.

The Gallman brothers filed approximately 37 fraudulent tax returns seeking refunds totaling $218,094,765, for which the IRS paid two refunds totaling $16,512,492. The defendants knew that the trusts were not entitled to the tax refunds.

According to court documents and evidence presented at the sentencing hearing, Sean and Eric Gallman admitted that they established trusts and business entities, and used mailboxes at numerous private commercial postal carrier stores in Maryland and North Carolina as the addresses for the trusts and business entities.

For example, in January 2013, Sean Gallman mailed to the IRS a fraudulent 2012 tax return in the name of the Gallman Charitable Trust, requesting a refund of $8,218,930. The defendants deposited the two refunds in bank accounts they controlled. To hide their receipt of these refunds, the defendants used cashier’s checks and other financial instruments to transfer a portion of the money to third parties and other bank accounts.

The government seeks the forfeiture of the two refunds paid by the IRS, including $11,529,954 seized from numerous bank accounts; foreign currency, and gold and silver coins, seized from a residence in Upper Marlboro; nine residential properties located in Upper Marlboro and Laurel, Maryland, North Carolina and South Carolina; and two Mercedes-Benz vehicles and a Hyundai vehicle.

U.S. District Judge Paul W. Grimm has scheduled sentencing for May 17, 2016, at 10:00 a.m. The defendants face a maximum sentence of 20 years in prison for conspiring to commit mail and wire fraud, conspiring to commit money laundering, and mail fraud. Sean Gallman also faces a maximum sentence of 20 years in prison for an additional count for mail fraud and for money laundering; and a mandatory minimum of two years in prison consecutive to any other sentence imposed for aggravated identity theft.

United States Attorney Rod J. Rosenstein praised IRS-Criminal Investigation for its work in the investigation. “These two criminals filed bogus tax returns claiming ‘refunds’ that were not owed, and stole over $16 million from the IRS,” said U.S. Attorney Rosenstein. “Federal agents and prosecutors have a duty to pursue perpetrators of such fraud schemes and try to recover money stolen from the United States Treasury.”

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