A Bronx tax preparer who became known as the “tax magician” was charged Monday with committing $100 million fraud.
Rafael Alvarez, 60, made $15 million for his company ATAX New York and stole $100 million from the federal government in the decade-long scheme, the Justice Department said. But now his alleged house of cards has collapsed.
“While Alvarez may have been known as the ‘magician,’ he can’t say abracadabra and make these charges disappear,” IRS agent Thomas Fattorusso said in a press release. “Today’s arrest was no magical illusion, and Alvarez now faces the reality of his actions.”
Alvarez ran ATAX from 2010 to 2020, though he began preparing tax returns for people in the 1990s, according to the feds. Eventually, he became so good at getting people unexpected refunds that customers called him “the magician,” police said.
But Alvarez’s magic tricks were actually just blatant fraud, according to investigators. He created “bogus itemized tax deductions, made-up capital losses, phony business expenses and fraudulent tax credits,” among other things, to reduce customers’ tax burdens, the feds said.
“Alvarez’s sleight of hand was criminal tax fraud, a serious federal tax crime he was allegedly committing for over a decade,” Manhattan U.S. Attorney Damian Williams said in a press release.
Prosecutors called Alvarez’s scheme one of the largest frauds ever committed by a single tax preparer. They said he submitted tens of thousands of false returns.
Alvarez, a resident of Cortlandt Manor in Westchester County, faces a laundry list of charges, including one count of conspiracy to defraud the United States. He was also charged with four counts of preparing false tax returns, four counts of attempting to interfere with internal revenue laws, one count of aggravated identity theft and one count of making false statements.