Bannock County District court sentenced Candace Raschke to at least five years in prison for embezzlement and three years for tax evasion during her time as an office and administrative manager from 2011-2017.
Raschke used her position to give herself raises and used business funds for personal purchases. The judge ordered Raschke to pay $12,000 to the victim in the embezzlement case, and $1,203 to the Idaho State Tax Commission in the tax evasion case.
One reason Raschke received a conviction for tax evasion was that she forgot to include information on embezzled money when filing her taxes.
“Taxpayers must report income from all sources on their taxes, including income from illegal activities,” said Tax Commission Chairman Jeff McCray in a press release. “Unclaimed income from an illegal source can result in prosecution for tax evasion, as well as charges for the underlying crime.”
The Fraud and Criminal Investigation unit at the Idaho Tax Commission examines tax returns for any signs of fraud. It receives hints about potential tax crimes from police officers and tips from the public.
Christen Lewis, the tax audit manager of the Fraud and Criminal Investigation unit, said her team investigates two types of tax fraud.
First, tax identity theft. Tax identity theft occurs when an unknown person files a return in someone else’s name and hopes to steal their refund.
Lewis said her unit prevented over $29 million in fraudulent returns on almost 3,400 individuals in Idaho.
Second, falsifying tax returns. This takes place when Idaho residents falsify their tax returns to increase their refunds or reduce their tax dues.
Lewis said both types are investigated throughout the year, though there is an influx during tax season from January to April.
Targeting college students
Lewis said certain tax preparers target college students through campus visits and social media advertisements. Preparers convince college students to do extra credits they may not qualify for when filing tax returns to increase the tax refund
They pay part of that return to the preparer, but the return gets flagged by the Tax Commission for additional research and potential fraud.
Lewis warned students to be wary of tax preparers promising larger-than-average tax refunds.
“If the promise sounds like it’s too good to be true, it is too good to be true,” Lewis said. “If the fees sound high compared to the refund that they’re offering, also be wary of that.”
She encouraged students to file taxes early.
“The earlier you file, the better chance somebody else doesn’t have a chance to file in your name,” Lewis said.