The operator of a Glendale tax preparation business was sentenced Monday to 46 months in prison after admitting to pocketing more than $1.2 million in client tax refunds, authorities said.
Michael Joseph Calalang Cabuhat, half-owner of VisionQwest Resource Group Inc., was arrested in April 2016 after a criminal complaint was filed against him alleging wire fraud, identity theft and structuring financial transactions to avoid reporting requirements.
Cabuhat pleaded guilty to wire fraud and subscription to a false federal income tax return in June 2016, according to the U.S. Attorney’s Office.
Federal officials said the 41-year-old Hollywood Hills resident, who referred to himself as the “celebritytaxguy,” defrauded over 150 of his clients from 2010 to 2016.
Officials said he would pocket the money in two ways.
One method involved giving a client a copy of their tax return different from what he filed with the IRS. The fraudulent return would show a client receiving a smaller refund that what they were actually owed.
Cabuhat would then direct the IRS to deposit the smaller refund into the client’s account and then put the remaining money into his own account.
The other method involved Cabuhat falsely telling clients they owed taxes and then filing returns seeking refunds. He would then inform clients that they could pay off their taxes by making payments directly to him.
Cabuhat would then pocket both the “tax payment” and the refund.
In addition to serving prison time, he is also expected to pay back more than $1.4 million restitution to his former clients and to the IRS. Cabuhat has agreed to turn over $426,528 made from the sale of his home and a Ferrari 360 Spider that was seized by federal agents.