Fraud-Tax Prosecutions for 2018
Number Year-to-date 397 Percent Change from previous year -27.3 Percent Change from 5 years ago -52.8 Percent Change from 10 years ago -32.5 Percent Change from 20 years ago -51.4
Table 1: Criminal Fraud-Tax ProsecutionsThe latest available data from the Justice Department show that during the first ten months of FY 2018 the government reported 397 new fraud-tax prosecutions. If this activity continues at the same pace, the annual total of prosecutions will be 476 for this fiscal year. According to the case-by-case information analyzed by the Transactional Records Access Clearinghouse (TRAC), this estimate is down 27.3% over the past fiscal year when the number of prosecutions totaled 655.
The comparisons of the number of defendants charged with fraud-tax-related offenses are based on case-by-case information obtained by TRAC under the Freedom of Information Act from the Executive Office for United States Attorneys (see Table 1).
Compared to five years ago when there were 1,009, the estimate of FY 2018 prosecutions of this type is down 52.8 percent. Prosecutions over the past year are lower than they were ten years ago. Overall, the data show that prosecutions of this type are down 32.5 percent from the level of 705 reported in 2008 and down 51.4 percent from the level of 980 reported in 1998.
The long term trend in fraud-tax prosecutions for these matters going back to FY 1998 is shown more clearly in Figure 1. The vertical bars in Figure 1 represent the number of fraud-tax prosecutions of this type recorded each fiscal year. Projected figures for the current fiscal year are shown. Each presidential administration is distinguished by the color of the bars. To view trends month-by-month rather than year-by-year, see TRAC's monthly report series for the latest data.
Leading Investigative Agencies
The lead investigative agency for fraud-tax prosecutions through July 2018 was "Treasury - Internal Revenue Service" accounting for 90.2 percent of prosecutions referred.
As shown in Figure 2, additional agencies with substantial numbers of fraud-tax referrals were: Justice - Federal Bureau of Investigation (3.3%).
Top Ranked Lead Charges
Table 2 shows the top lead charges recorded in the prosecutions of fraud-tax matters filed in U.S. District Court during the first ten months of FY 2018.
Note: There were an additional 45 other lead charges which were not individually ranked. See latest monthly report if you want all lead charges included in rankings for the latest month, or use TRACFED criminal analyzer tool for complete listing for any year.
Lead Charge Count Rank 1 yr ago 5 yrs ago 10 yrs ago 20 yrs ago 26 USC 7206 - Fraud and False statements 135 1 1 1 2 2 More 26 USC 7201 - Attempt to evade or defeat tax 81 2 2 2 1 1 More 18 USC 371 - Conspiracy to commit offense or to defraud US 43 3 3 5 3 5 More 26 USC 7202 - Willful failure to collect or pay over tax 22 4 7 7 7 12 More 18 USC 286 - Conspiracy to defraud the Government claims 18 5 4 4 6 6 More 18 USC 287 - False, fictitious or fraudulent claims 16 6 4 3 4 4 More 18 USC 641 - Public money, property or records 15 7 6 6 18 32 More 18 USC 1343 - Fraud by wire, radio, or television 13 8 7 17 17 32 More Other US Code Section 10 9 12 11 11 9 More 26 USC 7203 - Willful failure to file return, supply information 6 10 14 7 5 3 More
Table 2: Top charges filed
"Fraud and False statements" (Title 26 U.S.C Section 7206) was the most frequent recorded lead charge. Title 26 U.S.C Section 7206 was ranked 1st a year ago, while it was the 1st most frequently invoked five years ago. It was ranked 2nd ten years ago and 2nd twenty years ago.
Ranked 2nd in frequency was the lead charge "Attempt to evade or defeat tax" under Title 26 U.S.C Section 7201. Title 26 U.S.C Section 7201 was ranked 2nd a year ago, while it was the 2nd most frequently invoked five years ago. It was ranked 1st ten years ago and 1st twenty years ago.
Ranked 3rd was "Conspiracy to commit offense or to defraud US" under Title 18 U.S.C Section 371. Title 18 U.S.C Section 371 was ranked 3rd a year ago, while it was the 5th most frequently invoked five years ago. It was ranked 3rd ten years ago and 5th twenty years ago.
Again among the top ten lead charges, the one showing the sharpest projected decline in prosecutions compared to one year ago—down -64 percent—was "False, fictitious or fraudulent claims " (Title 18 U.S.C Section 287 ). This was the same statute that had the largest projected decrease—-83%—when compared with five years ago.
Top Ranked Judicial Districts
During FY 2017 the Justice Department said the government obtained 2 fraud-tax prosecutions for every one million people in the United States. If pace during the first ten months of FY 2018 continues at the same rate, fraud-tax prosecutions for one million people in the United States this year will be 1.5 . Understandably, there is great variation in the per capita number of fraud-tax prosecutions in each of the nation's ninety-four federal judicial districts
Judicial District Percapita Count Rank 1yr ago 5yrs ago 10yrs ago 20yrs ago W Virg, N 5 4 1 1 33 36 24 More Penn, W 5 15 2 9 25 20 17 More N. Y., W 5 11 3 6 14 19 62 More R. I. 5 4 4 86 40 45 9 More Ala, S 4 3 5 61 19 - 83 More Ala, M 4 4 6 74 2 17 69 More D. C. 4 2 7 22 10 53 10 More N. J. 3 26 8 55 24 21 18 More Ind, N 3 7 9 11 20 24 67 More Nebraska 3 5 10 18 22 54 72 More
Table 3: Top 10 districts (per one million people)
The Northern District of West Virginia (Wheeling)—with 5.17 prosecutions as compared with 1.5 prosecutions per one million people in the United States—was the most active through July 2018. The Northern District of West Virginia (Wheeling) was ranked 1st a year ago. The district's position ten years ago was 36th and 24th twenty years ago.
The Western District of Pennsylvania (Pittsburgh) ranked 2nd. The Western District of Pennsylvania (Pittsburgh) was ranked 9th a year ago. The district's position ten years ago was 20th and 17th twenty years ago.
The Western District of New York (Buffalo) now ranks 3rd. The Western District of New York (Buffalo) was ranked 6th a year ago. The district's position ten years ago was 19th and 62nd twenty years ago.
Recent entries to the top 10 list were Northern District of Indiana (South Bend), Nebraska, Washington, D.C. (Washington), New Jersey, Southern District of Alabama (Mobile), Middle District of Alabama (Montgomery) and Rhode Island, now ranked 9th, 10th, 7th, 8th, 5th, 6th and 4th. These districts ranked 11th, 18th, 22nd, 55th, 61st, 74th and 86th one year ago and 20th, 22nd, 10th, 24th, 19th, 2nd and 40th five years ago.
Compared to 10 years ago, Middle District of Alabama (Montgomery), Western District of New York (Buffalo), Western District of Pennsylvania (Pittsburgh), New Jersey, Northern District of Indiana (South Bend), Northern District of West Virginia (Wheeling), Rhode Island, Washington, D.C. (Washington) and Nebraska now ranked in the top 10 did not appear in the top ten.
And compared to 20 years ago, Western District of Pennsylvania (Pittsburgh), New Jersey, Northern District of West Virginia (Wheeling), Western District of New York (Buffalo), Northern District of Indiana (South Bend), Middle District of Alabama (Montgomery), Nebraska and Southern District of Alabama (Mobile) were not sufficiently active to then make the top 10.
The federal judicial district which showed the greatest projected growth in the rate of fraud-tax prosecutions compared to one year ago—379 percent—was Middle District of Alabama (Montgomery). Compared to five years ago, the district with the largest projected growth—59.9 percent—was Northern District of West Virginia (Wheeling) .
In the last year, the judicial District Court recording the largest projected drop in the rate of fraud-tax prosecutions—40.0 percent—was Northern District of West Virginia (Wheeling).
Report Generated: October 4, 2018
