TAMPA (CN) - Prosecutors say two tax preparers claimed more than $30 million in bogus credits - on 6,000 tax returns - by claiming to produce and sell methane from landfills. But the plants producing "fuel from nonconventional sources" are a fantasy, and so were the "ownership interests" that George Calvert and Gregory Guido sold customers - who allegedly "bought" their "interest" in the fantasy with money from the bogus tax credits.
Prosecutors say Calvert dba Calvert & Associates, of Hernando Beach, Fla., and Guido, of Lithia, Fla., have sold the phony tax dodge since 2001. Calvert was a CPA and a partner in Arthur Andersen & Co. for more than 20 years and has "an extensive background in both tax and the energy industry," prosecutors say. He incorporated Resource Technology Corp. in 1992 in Chicago, and has been president and COO of Extratech, in Tampa, since 2001.
"Guido became involved in the FNS credit tax scam in 2001 when Calvert joined Extratech," according to the complaint. "Guido is a co-founder and the chief financial officer of Extratech. He ... is a CPA ... (and) began his tax career in 1981 at KPMG Peat Marwick ..."
Prosecutors say them men's customers would "purportedly purchase an interest in a nonconventional energy production facility through partnerships created by Calvert and Guido." To qualify for the "FNS" credits, "Calvert and Guido provide customers with false documentation, including false production statements, to substantiate their claim that the production facilities are producing qualified fuel from landfill biomass. The production facilities are purportedly located on landfills located in Puerto Rico, Illinois, New York, Ohio and Connecticut. However, in most instances there is no energy production facility in place on the landfill and even when such an entity exists, there is no infrastructure in place to produce energy.
In all instances, Calvert's and Guido's partnerships had no ownership in the energy production facility, if one existed, or the landfill for the tax years for which they sold interests to customers. In addition, customers do not pay for their interest in the sham facility until the year after they claim FBS credits purportedly related to their sham interest. Their payment is funded by the tax refund they receive as a result of claiming the bogus FNS credits."
Prosecutors sued 30 other individuals and one other professional association. They say they have minimal information about the years before 2003 so "the harm to the government could very well be higher" than $30 million.
Read the Top 8
Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.