John Barry Jr, Tax Return Fraud, New Jersey 2023

New Jersey man sentenced to 12 years in prison for helping others file false tax returns claiming large refunds from the IRS.

John Barry Jr., of Pemberton, New Jersey, was convicted by a jury on July 23 of conspiring to defraud the IRS, aiding and assisting the preparation of false tax returns, obstructing the IRS and failing to file a tax return. Barry was sentenced to 12 years in prison for his role in the scheme.

According to court documents and testimony, in 2015 and 2016, Barry conspired with individuals in Georgia, North Carolina, Virginia and New York to promote a ‘mortgage recovery’ tax fraud scheme in which Barry and his co-conspirators obtained tax refunds for their clients based on fraudulent tax returns. The refunds totaled more than $4 million.

Barry typically charged each client a fee of between 20% to 35% of the refund the client obtained, and then he split those fees with some of his co-conspirators. In addition to his role in the ‘mortgage recovery scheme,’ Barry did not file his own 2016 return despite earning income in excess of the filing threshold, and he did not report or pay taxes on the income generated from the scheme in that tax year.

When the IRS discovered the fraud and attempted to recover the wrongfully paid refunds, Barry obstructed the agency by providing clients with fraudulent documents to send to the IRS, directing clients to conceal his role in filing their false returns and advising a client to remove funds from his bank account to prevent collection efforts.

U.S. District Judge Robert B. Kugler ordered Barry to serve three years of supervised release and to pay approximately $4,240,733 in restitution to the United States.

Acting Deputy Assistant Attorney General Stuart M. Goldberg made the announcement.

The IRS Criminal Investigation Division investigated the case, and Trial Attorneys Sean Green and Samuel Bean prosecuted the case.

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