Taxable Talk

Last year I wrote about Naftali Tzi Weisz. Mr. Weisz is the Grand Rabbi of Spinka. He'll also be standing trial in September charged with tax fraud. He's accused of soliciting charitable donations but promising to refund most of the money—a scheme that's definitely not kosher.

On Friday two alleged co-conspirators pleaded guilty. Joseph Roth, a Tel Aviv-based banker with United Mizrahi Bank pleaded guilty to conspiracy. And Rabbi Moshe Zigelman will plead guilty on Tuesday. Mr. Roth admitted that he established secret bank accounts overseas and helped repatriate the money to the United States. Rabbi Zigelman's attorney told the Los Angeles Times "his client was 'atoning for his own wrongdoing' and would not testify against the other defendants.

Given the alleged size of the tax fraud—millions of dollars—Grand Rabbi Weisz is looking at a very lengthy term at ClubFed if convicted this Fall.

Two more Bozo tax preparers won't be harming consumers any more. Let's just say up front that the methods used weren't wise.

First, we'll head to Union City, Georgia. Majalai Wisdom prepared plenty of tax returns from 2000-2004.Me And her clients got lots of refunds (and gave her back $500 - $1500 in cash from each refund they received). Of course, the fact that Ms. Wisdom made up her own W-2s for clients using nonexistent employers, added phony exemptions and credits, including children who had nothing to do with the taxpayer. Now, perhaps if she used just one of those methods she wouldn't have gotten caught. However, sooner or later the IRS computers would wonder why Joe Taxpayer showed income from Acme but Acme never filed its W-3 with the government. Ms. Wisdom was sentenced to 30 months at ClubFed.

Meanwhile, the proprietor of Melba's Tax Service in Batesville, Arkansas will soon be at ClubFed. Melba Nelia Lopez pleaded guilty to two counts of preparing false tax returns. Ms. Lopez appears to have also added phony items to clients' returns causing the government a loss of about $95,000. She'll be sentenced later this year.

And what will likely happen to users of Ms. Wisdom or Ms. Lopez? Their clients will soon be receiving "Dear Soon to be Audited Taxpayer" letters (if they haven't already received them). Remember, if it sounds too good to be true it probably is.