NOVEMBER 12, 2007
Two public employees in the District of Columbia’s tax and revenue office have been charged with embezzling nearly $20 million by approving and issuing fraudulent tax refunds to family members who used the money to buy luxury cars, homes, jewelry and expensive clothes.
The scheme was designed to steal tens of millions of dollars from the District of Columbia and federal authorities have called it the biggest corruption ring in city history because so many millions were so easily skimmed in such a short time.
The two tax and revenue employees (Harriett Walters and Diane Gustus) fabricated dozens of property tax refund checks for hundreds of thousands of dollars each over at least seven years. The checks averaged $388,000 each and the money was deposited in sham corporate accounts controlled by relatives who later shared the cash with the city employees.
The conspirators then purchased a variety of luxuries, including fur coats, fancy jewelry, designer handbags, houses and cars. One of the employees even made $1.4 million in charges at an upscale department store even though her government salary was only $81,000 a year.
Incredibly, no city officials noticed the massive fraud taking place over the years right under their respective noses. It was a private bank clerk, who grew suspicious of the large tax refund checks being deposited, who alerted authorities to investigate.
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