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U.S. IRS identifies 79 tax fugitives in Mexico, neighbors

Economy Oct 06, 2022 07:06AM ET
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By David Lawder

WASHINGTON (Reuters) - The Internal Revenue Service's Criminal Investigation unit said on Thursday it has located 79 tax evasion fugitives in Mexico, Belize, El Salvador, Guatemala and Honduras in the first year of a new extradition initiative.

The effort was made possible by a change in Mexico's tax laws in 2020 that made tax evasion a felony offense as part of a crackdown to improve weak tax collection. The reclassification paved the way for tax fugitives to be extradited to the United States.

Before this, tax crimes were non-extraditable offenses in Mexico, making it a haven for U.S. tax evaders. The IRS said that since June 2021, its Criminal Investigation (IRS-CI) branch in Mexico City has extradited eight of the 79 individuals identified for possible prosecution in the United States.

It expects the number of extraditions to grow as the process can take up to a year to complete.

"We are going after anyone who thinks they can cheat the government and simply flee to the south," said IRS-CI Mexico City Attaché Jaushua Brewer. "Now with so much help from our host country partners, it is even harder for criminals to escape justice."

IRS-CI identified one of the extradited fugitives as Jose Echeverria, formerly of Chelan Falls, Washington, who the agency said underreported U.S. income by more than $500,000 between 2009 and 2012, funneling hundreds of thousands of dollars to purchase land and vacation homes in Mexico.

IRS-CI said Thomas Johnson, formerly of Tampa, Florida, was arrested in Belize and faces U.S. charges of filing false tax returns on behalf of clients to claim large, fraudulent refunds.

The program's first year results were announced as the IRS is set to begin receiving some $80 billion in new funding to beef up compliance enforcement, taxpayer services and information technology. The agency plans to hire some 87,000 staff over the next decade, fueling claims from Republicans that they will constitute an "army" of new agents, many armed.

The Treasury has said that most of the new hires will replace a wave of retirements over the decade and improve customer service, including answering more taxpayer phone calls and programming new computers. The agency does plan to add new revenue agents, but the Treasury has not specified how many and has called for the IRS comprehensive spending plan in less than six months.

Currently, only about 2,100 IRS special agents in the Criminal Investigations unit are authorized to carry firearms.



U.S. IRS identifies 79 tax fugitives in Mexico, neighbors

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