Arrested at his home on Oct. 25, he appeared in court the following day, facing 18 counts of wire fraud, one count of conspiracy to commit wire fraud, and 22 counts of aiding and assisting in the preparation of fraudulent income tax returns, the Department of Justice in North Texas announced late Thursday.
Garza later entered a plea of not guilty and was subsequently released after appearing in court, records show.
By hiding the $1 billion, Garza “conned” the IRS out of some $200 million, the DOJ alleged in its release.
In effect, the feds claim, Garza created shell companies for “services” and “investments,” which made it possible for his clients to avoid paying their taxes. The scheme involved creating fake invoices, fake operating agreements, ginned-up service agreements and other falsified documents.
According to the 15-page indictment, Garza’s alleged activities took place between 2012 and 2021, during which time “Garza and others unlawfully and unjustly enriched themselves” through the tax shelters.
"Our country functions best when every citizen pays his or her fair share." – U.S. Attorney Chad Meacham
If convicted, he could spend two decades behind bars for each of the wire fraud counts, 20 years for conspiracy to commit wire fraud, and three years for each count of aiding and assisting in the filing of false federal income tax returns.
“This attorney allegedly hid more than a billion dollars of client income from the IRS, conning the U.S. Treasury out of roughly $200 million and lining his own pockets in the process,” U.S. Attorney Chad Meacham said in the DOJ’s release. “Our country functions best when every citizen pays his or her fair share. We will aggressively pursue anyone who subverts our tax laws.”
In the release, Christopher J. Altemus Jr., a special agent in charge of the IRS Criminal Investigation Dallas Field Office, said Garza’s arrest “should serve as a warning that individuals who create elaborate schemes that have no purpose other than to defraud the IRS and shift the tax burden to honest American taxpayers will be prosecuted.”
Public defenders listed in court records as Garza’s legal counsel did not respond to the Observer’s request for comment.