Ex-Salon Owner Charged as Early Cohort in Tax Scam
Tuesday, July 8, 2008
A former hair salon owner and longtime friend of the woman at the center of the D.C. tax scandal was one of the scheme's earliest participants and collected about $1.2 million in fraudulent refund checks, according to court papers filed by prosecutors yesterday.
Samuel Earl Pope, 61, played a key role in propelling a relatively modest swindle into a massive embezzlement scheme that siphoned as much as $50 million from the District government, the court papers state. Prosecutors said that he joined the scam in 1991, about two years after it allegedly began, and got at least 50 illegitimate refund checks over the next 16 years.
Pope was charged in U.S. District Court with mail fraud and money laundering in a "criminal information" document, which can be filed only with the defendant's consent. The filing can be made only after a defendant waives the right to have the case reviewed by a grand jury. It typically signals that a plea agreement is in the works.
No court date has been set for Pope, and his attorney, Barry M. Tapp, declined to comment. The criminal information "kind of speaks for itself," Tapp said.
The charging papers provide the most complete account of how the thefts grew in frequency and size until authorities caught on to the scam last year. They provide new details about the way the plot was allegedly crafted and fine-tuned by Harriette Walters, 51, a former mid-level manager in the D.C. Office of Tax and Revenue.
Walters, who remains in jail on federal conspiracy, mail fraud and money laundering charges, has been cooperating with authorities, sources familiar with the investigation have said. Twelve people have been charged in the case, and six have pleaded guilty. Walters's attorney declined to comment yesterday.
Pope and Walters became friends in the late 1980s when she started having her hair done at his now-closed Head to Toe Salon in Southwest Washington, the charging papers state. Pope also ran a car service that Walters used for trips to Atlantic City and elsewhere, the documents say.
By 1991, Pope confided in her about the trouble he was having in meeting business expenses, including rent for his salon, the documents state. She in turn invited him to participate in a budding scheme in which she prepared fraudulent property tax refund applications that resulted in D.C. government checks to others in the scam, prosecutors wrote.
In the two previous years, prosecutors wrote, the refund checks were issued to individuals, and none of them exceeded $10,000. But Walters realized she could steal far more money if she got the government to issue sham refund checks to businesses, they wrote.
In May 1991, she manipulated the refund process and had her office issue Pope's business a fraudulent property tax refund for $37,639, more than four times the size of the largest check in the scam to that date, prosecutors wrote. And the money kept coming, they said, with the scam's biggest check totaling nearly $93,000.
Pope split the money with Walters, prosecutors wrote. He also allegedly received $412,000 from others in the scam, they said, including Jayrece Turnbull, Walters's niece, who also is charged in the case.
The charges against Pope are the latest indication of just how wide a net Walters allegedly cast in recruiting cohorts. Among those who have already pleaded guilty: Connie Alexander, a casino worker she befriended in 1992; Walter Jones, a bank manager she met in 1994; and Marilyn Yoon, a Louis Vuitton saleswoman she met in 2000. All have admitted to helping in the scheme.
It is not clear how Pope spent his share, but prosecutors alleged that he used tens of thousands of dollars to buy a restaurant in Mississippi and make mortgage and car payments. In the charging papers, they seek a judgment against Pope of nearly $1.6 million.
The court papers also lay out how Walters allegedly found ways to outmaneuver an internal computer system installed between 2000 and 2004 to streamline the tax office and reduce fraud. She manipulated the Integrated Tax System to steer more than $150,000 to Pope last year, the charging papers say.