A former Bend resident has been sentenced to a year in federal prison and ordered to repay more than $300,000 in restitution in a fraudulent refund scheme that also involved taking retaliatory action against IRS agents, prosecutors said Friday.
On Wednesday, U.S. District Judge Ann Aiken sentenced Mark Timothy Ellis, 38, now of Oregon City, for making a fraudulent claim to the United States and for filing a false lien against a federal employee to serve 12 months and one day in prison and three years of supervised release, and ordered him to pay $311,459 in restitution.
According to court documents, Ellis admitted that he made a false claim to the federal government when he filed a series of fraudulent documents with the Internal Revenue Service, including false 1099s and false tax returns, and obtained a fraudulent $311,459 refund based on those false documents.
Prosecutors said Ellis also admitted that he filed a false and retaliatory lawsuit and false and retaliatory liens against the IRS employees who were investigating his illegal conduct, including the special agent who was investigating him for tax fraud, as a means of retaliation and intimidation.
This case was investigated by IRS Criminal Investigations and the U.S. Treasury Inspector General for Tax Administration and was prosecuted by Assistant U.S. Attorney Scott E. Bradford.
Ellis was arrested in February of last year by federal marshals and given conditional release pending later court dates. An indictment claimed he filed four false refund claims between 2008 and 2010. He also was accused of making false claims to retaliate against former Treasury Secretary Timothy Geithner and two Eugene IRS employees.
Starting in 2007, prosecutors alleged, Ellis “used and promoted illegal debt termination programs in an attempt to fraudulently cancel his and others’ debts, including home mortgages and credit card bills, and to falsely obtain tax refunds to which he and others were not entitled.”
Prosecutors also allege in the indictment that Ellis “purchased and used trusts in order to illegally hide or shield his income and assets, including business income, from the IRS.”