A Wasilla woman who allegedly prepared false tax returns for drug dealers is charged in federal court with helping them hide their black market proceeds.
The charges filed Tuesday allege that Rebecca Renae Powell, the 37-year-old owner of AK Contractors Bookkeeping Services in Wasilla, prepared false tax forms for a man who grew and sold marijuana and another man who sold marijuana and heroin.
Powell is charged with six counts of preparing false tax returns.
It is unclear from the charging document in Powell's case who the two men are -- they are called "D.J." and "D.H.," respectively -- and few details of their supposed drug dealing are revealed in her charges. A federal prosecutor would not say if the men are charged in a separate case.
Powell began preparing tax returns for D.J. and his wife, C.J., in April 2007 and, apparently going back to work on earlier years' returns, she ultimately prepared the couple's false tax returns for 2003 through 2007, the charges say.
The couple allegedly claimed the Earned Income Credit each of those years and concealed their income from growing and selling marijuana, which D.J., a longtime friend, sold to Powell on at least one occasion, according to the charges.
The charges say D.H., the other unnamed man, made a "significant" income from selling marijuana and heroin.
Powell started preparing his taxes in October 2007 and again allegedly helped conceal the drug proceeds through two legitimate businesses that D.H. owned, the charges say.
Powell's tax preparation helped D.H. "substantiate D.H.'s lifestyle and to allow D.H. to secure loans," the charges say.
While she was allegedly knowledgeable of the drug dealer's true earnings, Powell "fabricated both income and expense figures and created false invoices, bills of sale, and other documents designed to substantiate the fabricated figures in the event of an audit or other inquiry," according to the charges. Some of those included false business expenses that were never paid, the charges say.
Assistant U.S. Attorney Thomas Bradley would not comment on the possibility of charges against D.J. or D.H. in a separate case.
"At this point, we can't identify them," Bradley said.
Bradley said, in general terms, that it's difficult for drug dealers to use the money from their illicit trade to buy the things everyday people have.
"The problem with drug dealers is they have all this cash they want to get into the legitimate banking system. They want houses, they want cars," he said. "They have real income, but they have to make it look legitimate so they can get house loans and car loans."
The prosecutor would also not say exactly how much money the dealers involved in Powell's case had made from selling drugs, only acknowledging "it was a lot."
Powell's alleged crimes didn't end with the dealers.
In March of 2009, an undercover IRS agent went to Powell to get two tax returns prepared.
Powell went through the same scheme to prepare false returns, in part by forging more documents, the charges say.
"The purpose of this scheme was to make the undercover agent's purported drug income appear as though it was from a legitimate source, thereby minimizing the possibility that the 'taxpayer's' illegal activities would be discovered by law enforcement," the charging document says.
The undercover agent found that Powell charged significantly more for the false returns than for a typical return.
Most customers paid $50 for her tax preparation services. The charges say D.H. and the agent paid about $1,000 and $1,200, respectively.
Bradley said it's not uncommon for an IRS agent to go undercover and ask for phony tax returns.
And charging Powell on Tax Day was a coincidence, he said.
"It just worked out that way," Bradley said. "It's always a good time to remind people who are professional tax preparers, if they are knowingly going to conceal drug proceeds, that we're going to seek them out just as aggressively as taxpayers who are cheating."
Reach Casey Grove at email@example.com or 257-4589.