Another scammer indicted as ringleader’s trial nears

Another scammer indicted as ringleader’s trial nears

In August 2012, The Examiner blew the lid off the Syam tax scam, exposing the corrupt company and its staff of swindlers exploiting hundreds of elderly and disabled taxpayers in order to line their own pocketbooks. After intense scrutiny, investigators’ efforts have finally borne fruit. Two of Syam’s most active tricksters have been indicted and face up to 20 years in prison – and it all started here at The Examiner, sparked by complaints first submitted to the local BBB, who was investigating the allegations.

A little history

Dallas-based Syam Tax Services, also known as Baby Momma’s Tax Service, told tall tales of bogus tax credits offered to elderly and disabled residents. Agents of Syam targeted area residents at their homes and churches, offering to sign up clients for a government-sponsored Social Security stimulus rebate available through the IRS. In reality, no such stimulus ever existed, and the agents were obtaining the Social Security numbers and banking information of the persons they were claiming to help, ultimately filing false tax returns in the victims’ names and leaving their prey stuck with paying back the IRS and reclaiming their stolen identities.

After The Examiner’s initial investigation, federal and state agencies began targeting the company in an attempt to keep more vulnerable citizens from being taken advantage of and defrauded. In December 2012, following The Examiner’s profile on Syam victim Betty Murphy, Texas Attorney General Greg Abbott revealed the state’s investigation into Syam and warned consumers to stay away.

In January 2013, Abbott’s office filed a civil suit against Syam and two of its officers, Shannon Mays and Marshrief Shead, alleging multiple violations of the Texas Deceptive Trade Practices Act and the Texas Identity Theft Enforcement and Protection Act. In response to the state’s enforcement action, Judge Michael Gomez of the 129th District Court of Harris County froze Syam’s assets and entered a temporary injunction against all the named defendants.

“Targeting senior centers and churches, Syam Tax Services launched an apparently well-orchestrated scheme to defraud the elderly – and even worse, those who rely on federal benefits for their well-being,” Abbott said then. “My office is working to put a stop to this despicable fraud, and thanks to the court order we obtained, Syam is prohibited from continuing to violate the law.”

But Syam continued to operate in spite of the injunction, sometimes changing names of the business but never altering their fraudulent practices.

The U.S. Attorney for the Eastern District of Texas eventually obtained a criminal indictment against Syam owner Mays on Feb. 5, charging him with conspiracy to commit wire fraud.

According to the indictment, Mays attempted to avoid notice from the IRS by setting his sights primarily on people who do not have to file tax returns due to their exempt status, those most vulnerable to the tax scam. He is also accused of altering the victims’ personal information just enough to make sure the IRS could not reach them. In 2011, Mays reportedly filed more than 4000 tax returns for over $3 million.

Mays is currently scheduled for trial Dec. 8 before U.S. District Judge Ron Clark, and last week, one of Mays’ “recruiters” was also called on to answer for her misdeeds.

Another indictment

According to U.S. Attorney John M. Bales, Port Arthur resident Diana Broussard McCoy, 61, aka Diana Broussard, on whom The Examiner first reported in August 2012, was indicted on Oct. 1 by a federal grand jury charging her with conspiracy to commit wire fraud in relation to her role in the Syam tax scheme.

McCoy, like Myra Jones, who has not been charged, targeted church congregations and through word-of-mouth brought clients from as far away as Kountze and Jasper County to her Waco Avenue doorstep. The pair even visited at least one food bank line, soliciting individuals who depend on the facility for assistance, not only capitalizing on the disadvantaged community but also acquiring food for themselves – in effect taking it out of the hands of the very people who were the focus of their deception.

During two hours of surveillance, more than a dozen visitors showed up to McCoy’s home Aug. 14, 2012, seeking her services. A Port Arthur police officer following up on a complaint pertaining to potentially fraudulent tax preparation also visited her home during that time, but he would not be the last law enforcer to make the trip. After complaints from numerous victims, including Theodore Victor of Port Arthur, who says he fell prey to McCoy, Port Arthur Police and federal investigators executed a search warrant on her residence in Port Arthur Aug. 22, 2012, recovering numerous boxes of documents that contained the personal information of Port Arthur residents, information that had previously been faxed to Syam’s Houston office.

According to the Oct. 1 indictment, prosecutors report that an investigation into Syam began in August 2012 in response to numerous complaints to state and federal authorities from citizens in Port Arthur, Anahuac, Nacogdoches and Lufkin regarding income tax returns that were being fraudulently prepared on their behalf.

“During the investigation, it was discovered that Mays was operating numerous offices across the United States under the name ‘Syam Tax Services, L.L.C.’ and ‘Baby Momma Tax,’” reads the indictment. “Although the principal office was located in Dallas, Mays also operated or sought to operate satellite offices in numerous other locations, including Fort Worth, Houston, New Orleans, Memphis, Atlanta, Chicago and Los Angeles.”

The indictment alleges that Mays employed McCoy as a “recruiter” for Southeast Texas, and asserts that he paid her and his other agents between $50 and $100 for every referral, something Mays told The Examiner in August 2012.

“Mays targeted individuals who were generally exempt from having to file income tax returns because they would be less likely to discover a fraudulent tax return had been filed on their behalf,” states the indictment. “In order to avoid detection, Mays altered the taxpayer’s address and phone numbers on the returns so that any phone calls or correspondence from the IRS would not reach the taxpayer. The scheme also used electronic deposits to ensure paper checks would not be mailed to the taxpayer.

“For the tax year 2011, Syam Tax filed 4,226 tax returns claiming approximately $3,150,406.”

If convicted, McCoy faces up to 20 years in federal prison, the same as alleged co-conspirator Mays.

This case is being investigated by Internal Revenue Service – Criminal Investigation, Federal Bureau of Investigation, the Port Arthur Police Department, the Texas Attorney General’s Office – Consumer Protection Division, and the Treasury Inspector General for Tax Administration. This case is being prosecuted by Assistant U.S. Attorney Baylor Wortham.

Jennifer Johnson contributed to this report.