A Queens man who was serving time in federal prison for tax preparation fraud used a smuggled smartphone to file tax returns for clients, diverting hundreds of thousands of dollars in refunds to accounts that ‘he was in control, authorities said.
Abdel Soliman, 54, was arrested Monday on charges of wire fraud and conspiracy. According to an affidavit submitted as part of an arrest warrant application, he took more than $ 470,000 from clients in 2018 and 2019 while incarcerated in a minimum security camp at Lewisburg Federal Penitentiary, in Pennsylvania.
“Everything is ridiculous – it’s not true,” said Soliman, who is free with a $ 600,000 bond, in an interview this week.
Mr Soliman said he had never owned a cell phone in prison, adding that the arrest affidavit was based on the testimony of another inmate who had requested early release from house arrest.
“You wouldn’t believe how many phones are in federal prison camps,” Soliman said. “They are everywhere.”
Messages left with Louis M. Freeman, Mr. Soliman’s lawyer, were not returned.
The affidavit, prepared by a special agent in the IRS’s Criminal Investigations Division, states that while he was serving a 41-month sentence for a $ 2.9 million tax preparation fraud scheme, Mr. Soliman used a contraband cell phone to commit the same crime. Mr Soliman filled out tax forms for clients on his phone and kept some of their tax returns while sending clients documents showing lower reporting amounts, the affidavit states.
Some clients were unaware that the IRS had issued refunds on their behalf, the document says, and at least one client said he was unaware that Mr. Soliman was in jail at the time. The IRS interviewed 11 people it said had been defrauded by Mr. Soliman and found that he had taken more than $ 36,000 from them.
In other cases, according to the document, the IRS found that Mr. Soliman had collected “fees” of about $ 900 that he charged against his clients’ tax refunds without notifying them. The money was diverted to an account Mr Soliman was controlling with the help of unidentified “associates”, the document said.
The IRS investigator also accused Mr. Soliman, a naturalized U.S. citizen from Egypt, of laundering the money he had obtained from his clients, by sending $ 150,000 to an account in Egypt and over $ 40,000 on an account in Europe.
According to the affidavit, the Federal Bureau of Prisons provided the IRS with photos of an iPhone 6S that had been confiscated from Mr. Soliman on May 9 and had his contact details in his settings. Authorities were unable to further research the device because its data “was remotely erased during the inventory process,” the document said.
Federal records show Mr. Soliman was released from prison on October 9 and the affidavit says he was to remain on probation until 2023.
In 2003, he pleaded guilty to being charged with attempting to smuggle $ 659,000 out of the country at Kennedy International Airport, and was sentenced to 30 months.
The use of cell phones by inmates, including in the commission of crimes, is a growing concern, although the devices have been banned in federal prisons since 2010. The New York Times reported earlier this year that inmates of An Alabama state prison used cell phones to extort money from the families of fellow inmates.
In a statement, Justin Long, a spokesperson for the Federal Bureau of Prisons, said the agency “continues to tackle the issue of smuggling into our facilities, including smuggled cell phones.”
Mr. Long said he was unable to speak about Mr. Soliman’s case, or say how common it was for inmates to use cell phones to commit crimes. Federal prisons, he said, use metal detectors and whole-body imaging devices to find such devices.