Woodbury Tax Preparer Charged with Falsifying Tax Returns by Grand Jury

A federal grand jury sitting in New Haven returned a superseding indictment charging Thomas Thorndike, 61, of Milford, with the following charges:

• 23 counts of aiding and assisting the preparation of a false federal income tax return
• Four counts of making and subscribing a false tax return
• One count of obstruction of the administration of the Internal Revenue laws

According to the superseding indictment, Thorndike was the founder and owner of Cornerstone Financial Services of Woodbury, LLC, or CFS, a tax preparation and financial services business.

The superseding indictment was returned on Thursday, Sept. 22, according to United States Attorney for the District of Connecticut David B. Fein in a Friday, Sept. 23, press release from Tom Carson, public information officer with the United States Attorney District of Connecticut's office.

Thorndike was released on a $400,000 bond following his arrest in March of this year.

If convicted, Thorndike faces a three-year maximum term of imprisonment and a fine of up to $250,000 on each count.

U.S. Attorney Fein stated in the press release that an indictment is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt, the press release noted.

This case is being investigated by the Internal Revenue Service's Criminal Investigation and the Federal Bureau of Investigation.  The case is being prosecuted by Assistant United States Attorneys Eric Glover and Christopher Mattei.

History

On March 17 of this year, the grand jury returned an indictment charging Thorndike with 15 counts of aiding and assisting the preparation of a false federal income tax return and one count of obstruction of the administration of the Internal Revenue laws, the press release stated.

As the owner of CFS, Thorndike prepared federal tax returns for individuals and businesses in exchange for payment of a fee, according to the press release.

He also offered individuals to whom he provided tax preparation services an opportunity to purchase audit insurance, the press release stated. Purchasers of audit insurance could elect to be represented by Thorndike in connection with any IRS audit of their individual federal income tax returns.

The superseding indictment alleges that, in the course of preparing many of his clients’ tax returns, Thorndike allegedly improperly reduced the amount of tax due in a variety of ways, including allegedly falsely claiming deductions for charitable contributions, and allegedly falsely claiming deductions for job expenses.

The superseding indictment adds charges relating to several alleged fraudulent deductions on tax returns that Thorndike prepared for his two sons.

On the returns, it is alleged that Thorndike improperly identified cash payments from him to his children as wages, and then allegedly falsely claimed that his sons had incurred business and employee expenses, reducing the amount of tax due.

The superseding indictment also adds charges related to Thorndike’s personal tax returns for the 2005 through 2008 tax years.

According to the press release, it is alleged that Thorndike claimed hundreds of thousands of dollars in improper business deductions, including, but not limited to: alleged wage expenses for his children, which were personal payments to them; an alleged $25,000 payment for a Cadillac Escalade for one of his children; more than $12,000 in alleged personal carpentry work; a $27,983 alleged “sale of business property” loss stemming from Thorndike’s selling of an engagement ring after his marriage engagement had broken off.

The superseding indictment further alleges that, in December 2008, the IRS notified Thorndike that he was the subject of an IRS audit examining his preparation of tax returns for the tax years 2006 and 2007.

In connection with the audit, Thorndike allegedly assisted in the preparation of, and then submitted to the IRS, alleged falsified documents to support the alleged false deductions claimed on tax returns that were subject to the audit.