TAX OFFICE SCANDAL
Early Participant Gets 3-Year Term in D.C. Tax Office Scam
Friday, May 8, 2009
A Maryland woman was sentenced yesterday to just over three years in federal prison for accepting more than $450,000 in fraudulent refund checks in the D.C. tax scandal.
Alethia Grooms, 53, a graphics designer and close friend of the scheme's mastermind, pleaded guilty in July to possessing stolen property and conspiring to commit money laundering. She admitted to participating in the tax scam, which siphoned nearly $50 million from the D.C. government over two decades.
Grooms, who lives in Clinton, also admitted creating fraudulent government documents in 2007 in an attempt to deflect questions by suspicious bank employees.
U.S. District Judge Emmet G. Sullivan sentenced Grooms yesterday to 37 months in federal prison, as prosecutors had requested. He noted that Grooms received the scheme's first and last fraudulent refund checks.
"She was there from day one until the last day," Sullivan said. "She was not a minor" player.
The judge ordered her to pay back to the D.C. government more than $650,000, the amount prosecutors say she helped steal or launder for co-conspirators.
Fighting tears, Grooms asked for mercy. "I apologize for my behavior, my conduct," Grooms said.
Assistant U.S. Attorney David S. Johnson said Grooms played a key role in the scam, particularly in its early days. "Without Ms. Grooms's assistance, it's quite possible this scheme may not have occurred in the first place," he said.
Grooms was a friend of Harriette Walters, the former mid-level employee in the D.C. tax office who orchestrated the tax scam.
Walters prepared fraudulent applications for property tax refunds that resulted in D.C. government checks being issued to others involved in the scam. Walters awaits sentencing.
Prosecutors said Grooms and Walters gambled together, and Grooms acted as Walters's real estate agent when she bought her Northwest Washington home for $420,000 in 2000.
In June 1989, Grooms received the scheme's first fraudulent refund check, for $4,060. She would receive more than $450,000 in such checks over the years. Grooms also received cash and checks from Walters that totaled at least $42,000, prosecutors have said.
Grooms admitted helping Walters launder $145,000 in 2007, and she pleaded guilty to committing mortgage fraud by creating false wage and bank statements to help two women obtain loans.