SAN FRANCISCO - Lara Karakasevic, aka Lara Castle, pleaded guilty in federal court yesterday to conspiring to defraud the United States, announced Acting United States Attorney Alex G. Tse and Internal Revenue Service, Criminal Investigation (IRS-CI), Acting Special Agent in Charge Tara Sullivan. The plea was accepted by the Honorable Vince Chhabria, U.S. District Judge.
According to her plea agreement, Karasevic, 48, of St. Helena, Calif., admitted that between July 2008 and June of 2009, she and a coconspirator agreed to defraud the United States by obstructing the lawful function of the IRS by deceitful or dishonest means.
Karakasevic owned an internet-based consulting business called TTF Consulting, LLC, which operated out of a home in Petaluma. In exchange for a fee, TTF Consulting electronically transmitted for its clients certain forms to the IRS, including Forms 1099-OID. Form 1099-OID is a form used to report annual interest on certain types of securities. As part of the scheme, Karakasevic’s coconspirator received information from TTF Consulting clients, reviewed the information, and provided the information to Karakasevic so Karakasevic could complete the forms and submit the forms to the IRS. Between April 2009 and June 2009, Karakasevic prepared six forms for TTF Consulting clients knowing that the forms were false. Specifically, the forms reported false amounts of interest income and tax withholdings from certain financial institutions. In addition, after filing the false forms, TTF Consulting informed its clients that the clients could later file tax returns based on those forms. Karakasevic acknowledged that she was aware of a high probability that the purpose of the conspiracy was to obstruct and defeat the IRS’s efforts to collect income taxes and that, after October 2008, when she knew the purpose of the conspiracy was unlawful, she nevertheless continued with the scheme. In addition, Karakasevic submitted a 2005 federal income tax return on her own behalf requesting a $291,836 refund based on a false and fraudulent Form 1099-OID. Karakasevic admitted that, in sum, the intended tax refunds from the false and fraudulent tax returns submitted to the IRS based on her conduct amounted to $1,231,578.
On June 24, 2014, a federal grand jury handed down an indictment charging Karakasevic with one count of conspiracy to defraud the United States, in violation of 18 U.S.C. § 371, and one count of filing a false tax return, in violation of 26 U.S.C. § 7206(1). Karakasevic pleaded guilty to the first charge. The second charge will be dismissed at the time of sentencing if Karakasevic complies with the terms of the plea agreement.
Karakasevic is currently free on bond. Judge Chhabria scheduled her sentencing hearing for Oct. 2, 2018. Karakasevic faces a maximum statutory penalty of five years in prison and a fine of $250,000 for the conspiracy charge. However, any sentence will be imposed by the court only after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Assistant U.S. Attorney Cynthia Stier is prosecuting the case. The prosecution is the result of an investigation by the IRS-CI.
Source: U.S. Department of Justice, Office of the United States Attorneys
