D.C. OFFICE OF TAX AND REVENUE
Nephew of Tax Fraud Suspect Is First to Plead Guilty in Scheme
Saturday, May 3, 2008
A nephew of the woman accused of orchestrating a massive embezzlement scheme at the D.C. tax office became the first defendant yesterday to admit criminal wrongdoing in the fraud case, pleading guilty in federal court in Maryland to money laundering and receiving stolen property.
Ricardo Walters, 33, whose aunt Harriette Walters is suspected in the theft of up to $50 million in D.C. property tax money, said in court that he deposited $1.2 million in stolen money into his cleaning company's Bank of America checking account.
In all, authorities said, $4.2 million in fraudulent property tax refunds was deposited into the account for the business, Provident Home Services. Walters, of Fort Washington, admitted keeping $795,000 and disbursing $2.3 million to co-conspirators.
"The only thing I can say is, he's basically doing what he has to do to move on with his life," Walters's attorney, Hughie D. Hunt II, said yesterday after his client entered his guilty pleas in U.S. District Court in Greenbelt.
Walters, whose trial was to begin May 27, pleaded guilty in a deal with prosecutors in which they agreed to limit the prison time they will seek for him. Judge Alexander Williams Jr. scheduled sentencing for July 23.
Together, the two charges are punishable by up to 30 years in prison, but the U.S. attorney's office in Maryland said in a court filing that it will seek a term of five to seven years on each charge, possibly to be served concurrently. Hunt said he will ask Williams for a sentence in the range of three to four years.
Hunt said his client would not agree to help the government in its investigation of the tax fraud case. "Typically speaking, they always try to get people to cooperate," Hunt said. Asked whether Walters is reluctant to testify against his aunt, Hunt replied: "He signed a non-cooperation plea agreement. That's all I'll say."
Harriette Walters is accused of directing a years-long scheme while she was a manager at the D.C. Office of Tax and Revenue. Up to $50 million in checks was issued as fraudulent property tax refunds -- by far the biggest embezzlement of municipal funds in the city's history. Only a fraction of the money has been recovered.
Ten people have been charged in the case, and all but Ricardo Walters have pleaded not guilty. Harriette Walters, 51, and a niece, Jayrece Turnbull, 34, are in jail without bail, pending trials.
Beginning in 2006, "Harriette Walters provided Ricardo Walters various checks drawn on District of Columbia government accounts," according to a statement of facts agreed to by Ricardo Walters and filed in court by prosecutors.
"On multiple occasions, Harriett Walters directed Ricardo Walters to take the checks to Bank of America branches in Maryland and have Walter Jones, a Bank of America employee, deposit them into the Provident Home Services account," the statement says.
"On most occasions, when Ricardo Walters arrived at the bank, Harriett Waters had already provided to Walter Jones instructions on the manner in which to distribute the proceeds of the check. Specifically, Harriett Walters would direct Ricardo Walters to deposit a District of Columbia check and, using the funds from that check, obtain from Walter Jones cashier's checks made out to" others suspected of being involved in the scheme.
In December, Jones was charged with helping to launder stolen money.
As part of Ricardo Walters's plea bargain, authorities said, he agreed to forfeit two automobiles, a 2005 Chrysler Crossfire and a 1969 Chevrolet Camaro, and $272,000 in eight accounts at two banks.