Alleged Tax Fraud Used Cleveland Homeless To File False Returns

SHAKER HEIGHTS, OH — Three people are being charged for allegedly recruiting homeless and poor people and filing tax returns on their behalf, the Department of Justice and IRS announced on Thursday. Two of the accused ran tax preparation businesses.

The IRS said the accused filed 786 false tax returns and sought more than $3.5 million in refunds from the IRS.

The three people being charged are Muhammad Hague, 40, of Avon, Maryam Hague, 38, of Shaker Heights, and Richard Warren, 39, of Philadelphia. Muhammad and Warren are both being charged with one count of conspiracy to make false claims. Maryam is being charged with one count of conspiracy to commit theft of public money and one count of theft of public money.

Muhammad and Maryam are siblings. Maryam allegedly ran the Hague United Services, tax preparation business, which operated out of her homes in Cleveland and Shaker Heights. Muhammad ran his own tax preparation business called Hague Financial Services, court documents said.

In 2011, court documents say Maryam got her brother to recruit people to provide personal information and Maryam would prepare and file false tax returns on behalf of her clients. She allegedly taught Muhammad to do the same.

Between 2011 and 2013, Muhammad and another woman ran Hague Financial, which the DOJ said continued to advertise itself as a tax preparation business. Most of the company's business was conducted during normal business hours at Cleveland Water, where Muhammad and his colleague worked, court documents said.

Flyers, door-to-door solicitations and other tactics were used to market Hague Financial Services in lower income neighborhoods and homeless shelters in Cleveland, court documents said.

The DOJ said the operation expanded into Philadelphia when Maryam recruited Warren and his wife. The trio would allegedly seek out people who were willing to provide their personal information to Maryam, she would filed false tax returns in their names and Maryam agreed to pay a $1,000 "referral" fee for each claimant.

The DOJ also said that Warren and his wife established bank accounts for shell companies which were used to accept their "referral" fees.

The prosecution is looking to seize Maryam's home in Shaker Heights, court documents said. The investigation into the accused was led by the IRS.

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