A New Jersey man pleaded guilty today to filing false tax returns for clients that caused an intended loss of $327,647 to the United States.
According to court documents and statements made in court, Demetreus Hargrove, of Hoboken, operated a tax preparation business called The Wright Star LLC. The defendant fraudulently recharacterized the clients’ personal expenses as deductible business expenses for his clients’ business entities. The defendant reported these false business expenses and other false items on tax returns for the business entities. The defendant also filed individual income tax returns for clients reporting false business losses and fabricated bad debts.
Hargrove also admitted that he filed false tax returns for himself and The Wright Star LLC for the 2019 through 2023 tax years that claimed improper credits, deductions, losses or expenses that inflated his refunds in those years. He also agreed to pay restitution of $255,378 to the IRS.
Hargrove pleaded guilty to one count of aiding and assisting in the preparation of false tax returns. He is scheduled to be sentenced on April 13, 2027, and faces a maximum penalty of three years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division made the announcement.
IRS Criminal Investigation is investigating the case.
Trial Attorneys Lyndi McVey and Likhitha Butchireddygari of the Fraud Division’s Tax Section are prosecuting the case.
On April 7, the Department of Justice announced the creation of the Fraud Division. The Fraud Division is laser-focused on investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.