A former Internal Revenue Service revenue agent and tax preparer has pleaded guilty to charges that he tried to hire a hit man to kill four of his former clients who were scheduled to testify against him in a tax fraud case.
Steven Martinez pleaded guilty August 10 in a federal court in San Diego to criminal charges including murder-for-hire, witness tampering involving attempted murder, solicitation of a crime of violence, mail fraud, filing false tax returns, Social Security fraud, aggravated identity theft, and money laundering. Martinez pled guilty to a total of 12 counts in the superseding indictment.
As part of his guilty plea, Martinez admitted that in late February 2012, he solicited a third party to murder four former clients who were victims of his fraud and were slated to testify against him in his pending criminal tax case. Martinez reportedly directed his limousine driver, Norman Russell Thellmann, to deliver cash to a hit man who had been promised $100,000 to carry out the hit job.
The purported hit man instead contacted the San Diego division of the FBI on Feb. 28 to report the murder-for-hire plot by Martinez. According to the complaint, a subsequent meeting between the third party and Martinez was recorded and videotaped by the FBI.
According to the complaint, Martinez told the would-be assassin “he could make him rich for the rest of his life, $100,000 cash, if he eliminated the lady in Rancho Santa Fe and the lady in La Jolla.” The third party said Martinez “suggested that the former employee use two different pistols for the murders and that he acquire a silencer.”
Martinez admitted in court that he tried to prevent the former clients’ testimony by offering the third party $100,000 to murder them. He admitted he provided the hit man with four written packets of detailed information about the former clients, including photos of the soon-to-be murder victims, their homes and personal information. Martinez admitted that once the murders took place, he would pay the perpetrator $40,000 in cash, followed by the remaining $60,000 in cash within 72 hours of the murders.
In addition, Martinez admitted that he filed false tax returns and defrauded his clients by stealing over $11 million in tax payments. Martinez admitted that he presented his clients with completed tax returns indicating that they owed a significant amount of tax. He requested that his clients write checks payable for the amount of taxes due and owing to an alleged client trust account, instead of directly to the IRS or the California Franchise Tax Board.
Martinez also convinced the same clients to write checks during the tax year for estimated tax payments to the same alleged client trust accounts. Instead of depositing the checks into a true trust account, Martinez admitted that he took the checks and deposited them into several nominee bank accounts. In an attempt to conceal his fraud, Martinez admitted that he filed a different set of false tax returns indicating that his clients owed little or no income tax. Martinez admitted that he converted approximately $11 million in stolen taxpayer funds for his own personal benefit, and used them to make home improvements, purchase real estate, purchase a beach home in Mexico, pay for the use of a private airplane, make investments of more than $2 million in other entities, and make payments of more than $2 million for his personal use credit cards and loans.
As part of his fraudulent tax scheme, Martinez admitted that he committed Social Security fraud and aggravated identity theft by using the Social Security numbers of his clients without authorization when he filed the false tax returns with the IRS. Martinez admitted he committed mail fraud by mailing the false tax returns to the IRS. Martinez also admitted that he laundered approximately $2 million through nominee bank accounts for his own business and personal use. Finally, Martinez admitted that he knowingly and intentionally filed false personal income tax returns for tax years 2004, 2005, 2006 and 2007.
This case is being investigated by Special Agents with the IRS’s Criminal Investigation division, and the Federal Bureau of Investigation. A sentencing hearing has been scheduled for Nov. 30.
From Accounting Today
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