Date: 05-23-2018

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Judge: George L. Russell, III

Court: United States District Court for the District of Maryland (Baltimore County)

Plaintiff's Attorney: Martin Clarke and Sean Delaney

Defendant's Attorney:

Description: Baltimore, MD - Baltimore County Tax Preparer Found Guilty Of Filing False Tax Returns And Identity Theft

On May 22, 2018, a federal jury has convicted Dawn Chapelle Cottman, age 45, of Owings Mills, Maryland of fourteen counts of filing false tax returns, wire fraud and aggravated identity theft. Cottman owned a tax preparation business called 40 AM Tax Service, which she operated from her residence in Owings Mills.

The conviction was announced by United States Attorney for the District of Maryland Robert K. Hur; Acting Special Agent in Charge Kelly ‎R. Jackson of the Internal Revenue Service – Criminal Investigation; and Special Agent in Charge Gordon B. Johnson of the Federal Bureau of Investigation, Baltimore Field Office.

Evidence presented at trial showed that from January 2009 until March 2013, Cottman electronically filed hundreds of tax returns, then had the tax refunds for those returns directly deposited into her bank account instead of having the refunds sent to the taxpayers. Many of the returns she filed contained materially false information to increase the size of the tax refunds. The false information included fictitious personal income amounts and dependent information that qualified taxpayers for the Earned Income Tax Credit and American Opportunity Education Credit.

Cottman also prepared and filed income tax returns using the personal identifiers of other people without their knowledge and consent in order to fraudulently obtain a tax refund to which she was not entitled. Cottman paid money to various individuals to obtain the identities of other people in whose names she filed the false returns. Cottman had the resulting tax refunds directly deposited into her bank account.

Cottman was also convicted of filing a false personal tax return for 2011. Cottman falsely claimed in her tax return that her tax preparation business had gross receipts of $152,100 when, in fact, more than $1 million of other people’s tax refunds were wired into her bank account. Cottman also falsely claimed to have earned a net income of approximately $17,000 when, in fact, she spent more than $250,000 that year on personal expenses, including trips to Disneyland, Las Vegas, Busch Gardens and Atlantic City.

Cottman faces a maximum sentence of twenty years in prison for wire fraud, five years for filing false claims, three years for filing a false tax return, and a two-year consecutive sentence for aggravated identity theft. U.S. District Judge George L. Russell, III, has scheduled sentencing for August 10, 2018, at 2:00 p.m. in Baltimore.

United States Attorney Hur commended the Internal Revenue Service – Criminal Investigation and the FBI for their work in the investigation.

Outcome: Guilty

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