Former Freeport tax preparer sentenced to four years for nearly $12 million fraud

A former Freeport tax preparer was sentenced Thursday to four years in federal prison for fraud schemes involving nearly $11 million in improper tax refunds and approximately $1 million in fraudulent pandemic relief loans, federal prosecutors said.

Damaris Beltre, 59, of Freeport, was also ordered to pay $11,629,000 in restitution. U.S. District Judge Sanket J. Bulsara imposed the sentence Oct. 8 in federal court in Central Islip.

Beltre pleaded guilty in January to two counts of wire fraud and one count of aiding and assisting in the preparation of false tax returns. During that proceeding, she also admitted defrauding the U.S. Small Business Administration through false applications for COVID-19 aid as a business owner, prosecutors said.

Beltre owned and operated several businesses providing tax preparation and other financial services in Freeport. From approximately January 2021 through April 2024, she prepared fraudulent individual income tax returns and supervised employees who helped prepare them, prosecutors said.

The returns included fake dependents and bogus claims for COVID-19-related and motor fuel tax credits. Those claims reduced clients’ tax bills and generated refunds they were not entitled to receive.

Clients paid Beltre more than $1 million in preparation fees, including a percentage of their refunds, prosecutors said. The scheme caused the IRS to issue nearly $11 million in improper refunds and lose several million dollars in unpaid taxes.

In April 2023, an undercover federal agent hired Beltre to prepare a tax return. An accurate return would have shown the agent owed approximately $205, but Beltre submitted a fraudulent return claiming a refund of more than $14,243 and charged the agent $2,200, prosecutors said.

In the separate Paycheck Protection Program scheme, Beltre submitted false payroll reports and tax returns for corporate clients between approximately April 2020 and July 2022 to obtain about $1 million in fraudulent loans.

Prosecutors said Beltre used proceeds from the schemes to pay personal debts, fund a home in the Caribbean and purchase a car and jewelry.

U.S. Attorney Joseph Nocella Jr. said the sentence should warn dishonest tax preparers that abusing federal programs can lead to prison. IRS Criminal Investigation participated in the investigation, with assistance from the Freeport Police Department, U.S. Customs and Border Protection and the Small Business Administration.

Photo: Damaris Beltre/Facebook