Tax Fraud Scandal Rocks Little Rock
A Little Rock couple has been sentenced for their roles in defrauding the IRS, according to a damning investigation by the IRS Criminal Investigation and TIGTA.
John Dunn, 64, and his wife Wendy Dunn, 51, were sentenced in a federal court in Little Rock, Arkansas. John Dunn was sentenced to 33 months’ imprisonment, followed by three years of supervised release, and ordered to pay $437,053.84 in restitution to the IRS. Wendy Dunn was sentenced to five years of probation and ordered to pay $127,401.18 in restitution.
The investigation revealed that John Dunn conspired with others to defraud the United States for the purpose of obstructing the IRS in the assessment and collection of income taxes. The couple operated a quasi-financial consulting business, but failed to file business and personal tax returns reporting this income.
During an interview in September 2011, John Dunn lied to federal agents, saying he timely filed his federal income tax returns each and every year and accused the IRS of hiding his returns. He also falsely told federal agents that neither he nor his wife had been employed for many years, but that a family inheritance allowed them to live in their $500,000 residence.
John Dunn utilized a false social security number on his bank accounts to disguise his ownership and made numerous false and frivolous complaints against IRS employees in order to thwart the IRS’ collection and investigative efforts.
John Dunn filed bankruptcy, and with the assistance of co-defendant Nina Sue Williams, created fake tax returns with small amounts of income that he backdated and provided to the United States Bankruptcy Court to conceal his business activities and true earnings.
John and Wendy Dunn both pleaded guilty in June 2018. Nina Sue Williams pleaded guilty in May 2018 to making a false statement to the IRS and willfully failing to file income tax returns. In November 2018, Williams was sentenced to 24 months in prison and ordered to pay $103,201 in restitution to the IRS.
The investigation was conducted by IRS Criminal Investigation and TIGTA.
**Mandatory Facts:**
**Defendant/Respondent:** John Dunn, Wendy Dunn
**Criminal Charges:** One felony count of conspiracy to defraud the government, five misdemeanor counts for willful failure to file tax returns
**City and State:** Little Rock, Arkansas
**Date:** Sentencing occurred in two separate hearings, one on Monday, and another today
**Sentence or Outcome:** John Dunn: 33 months’ imprisonment, followed by three years of supervised release, $437,053.84 in restitution; Wendy Dunn: five years of probation, $127,401.18 in restitution
**Dollar Amounts:** $437,053.84, $127,401.18, $103,201
Key Facts
- State: Arkansas
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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