Financial Crime: Biblical tax cheat pleads guilty to filing for $2.9 billion in phony refunds to buy five-bedroom house, Mercedes Benz and Cadillac Escalades
In the end, the taxman always cometh.
A tax cheat of biblical proportions has pleaded guilty to filing for $2.9 billion in phony tax refunds in the name of made-up trusts sporting names taken from holy scripture.
David Isagba, 53, and his wife Joyce, 47, had been accused of submitting 227 false tax refund claims over the course of a decade, seeking billions of dollars to which they were not owed. The refund claims were filed for phony trusts, some with ancient Hebrew names like Tetragrammaton and Yetzirah.
Another trust was called Heaven’s Gate II Corp., in an apparent reference to the suicidal Heaven’s Gate cult.
Almost all of the bogus claims were rejected, but nine slipped through, with the IRS paying out $5.8 million to the couple, federal prosecutors said. The pair used some of the money to buy a five-bedroom house in Leesburg, Fla., as well as several Mercedes Benz sedans and Cadillac Escalades, according to court filings.
With each rejected claim, the IRS sent notices warning the couple to stop or face fines for false filing. But the pair would refuse to accept delivery, stymying government efforts.
In 2017, the IRS filed suit to seize the couple’s home, claiming it had been purchased with stolen government money. The couple stalled by placing the home in the name of various trusts, not responding to efforts to contact them and then renting the home out as the government moved to foreclose on the property.
The home was eventually sold at auction in 2020 for around $200,000.
A criminal matter
That same year, federal prosecutors brought criminal charges against the couple for mail fraud and conspiring to defraud the government. When David Isagba was arrested at John F. Kennedy International Airport, investigators say they found child pornography on his phone.
In court filings he wrote himself, Isagba sought to have the case dismissed, arguing that the U.S. government lacked legal standing to prosecute him and his wife and using language consistent with the sovereign citizen’s movement.
Members of the movement deny the legitimacy of the U.S. government and often refuse to pay taxes and gum up the legal system through endless and obstructive court filings.
On Wednesday, Isagba pleaded guilty in Florida in the tax fraud case for which he faces up to 30 years in prison. He had previously pleaded guilty in New York in the child pornography case and is scheduled to be sentenced in July. Charges are still pending against his wife, Joyce, with her trial set to begin in May.
Messages left with attorneys for David Isagba weren’t immediately returned. Joyce Isagba’s attorney declined to comment.
Prosecutors say the vast majority of the phony tax claims had been signed by David Isagba, who had a previous conviction in New York state court for criminal possession of a forged instrument in 2003.