An Arizona woman has pleaded guilty after federal prosecutors said she and others tried to steal more than $7.7 million from the IRS through false pandemic-era tax refund claims.
Regina Durkin, of New River, Arizona, pleaded guilty to one count of conspiracy to file false claims, according to the U.S. Department of Justice. Prosecutors said Durkin and others submitted false quarterly employment tax returns to the IRS seeking refunds tied to the employee retention credit and the paid sick and family leave credit.
Those credits were created to help businesses during the COVID-19 pandemic, but DOJ said the companies listed in the filings were not operating at the time, had no employees, and paid no wages.
The Claims Sought More Than $7.7 Million
In total, Durkin and others submitted 14 fraudulent claims to the IRS requesting more than $7.7 million in tax refunds, prosecutors said. DOJ described the case as an attempt to steal government funds through false filings, not a legitimate dispute over whether a business qualified for a pandemic tax credit.
“Our work continues as we find and prosecute individuals like Ms. Durkin who took a benefit meant to help the public during a crisis, and used it instead to line their own pockets,” U.S. Attorney Timothy Courchaine said in the DOJ announcement.
The Credits Were Supposed To Help Real Businesses
The employee retention credit and paid sick and family leave credit were designed for eligible employers during the pandemic. Prosecutors said the filings in Durkin’s case claimed refunds for companies that were not operating, had no workers, and paid no wages, removing the basic facts that would support the claims.
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division said tax fraud undermines public trust and that federal prosecutors are working to detect and prosecute criminal tax violations. IRS Criminal Investigation’s Phoenix Field Office is investigating the case.
Sentencing Is Set For September
Durkin is scheduled to be sentenced on Sept. 11. She faces a maximum penalty of 10 years in prison, though a federal district court judge will decide the sentence after reviewing the U.S. Sentencing Guidelines and other statutory factors.
The case is now at the guilty-plea stage. Prosecutors say the false refund claims sought pandemic credits for businesses that did not exist as active employers, and Durkin now faces sentencing for conspiracy to file false claims.