Garza, age 79, has been indicted on 18 counts of wire fraud, one count of conspiracy to commit wire fraud, and 22 counts of aiding and assisting in the preparation of fraudulent income tax returns. He allegedly charged clients a percentage of the money they had chosen to shelter.

He allegedly created multiple shell companies to create a circular flow of funds to help clients avoid paying taxes. The indictment alleges the shell companies were supposedly created to provide services to clients’ business or to serve as family investment vehicles.

However, these had no purpose other than to move money, according to the indictment

Garza allegedly utilized sham operating  and service agreements, phony invoices and false private annuity agreements to give the companies an air of legitimacy and conceal the scheme..  

The indictment accuses Garza and other of assisting clients in preparing and preparing Forms 1120 and 1120S, deducting business expenses for services that were never performed, and Forms1065, reporting gross receipts for payments to services companies that were not earned.

They also underreported taxpayer incomes on Forms 1040 and 1040x

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Bob Scott

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Bob Scott has provided information to the tax and accounting community since 1991, first as technology editor of Accounting Today, and from 1997 through 2009 as editor of its sister publication, Accounting Technology. He is known throughout the industry for his depth of knowledge and for his high journalistic standards.  Scott has made frequent appearances as a speaker, moderator and panelist and events serving tax and accounting professionals. He  has a strong background in computer journalism as an editor with two former trade publications, Computer+Software News and MIS Week and spent several years with weekly and daily newspapers in Morris County New Jersey prior to that.  A graduate of Indiana University with a degree in journalism, Bob is a native of Madison, Ind