Jury convicts Minnesota tax preparer for fabricating $1M in fraudulent client losses

A federal jury convicted a Minnesota tax preparer on 20 counts of aiding or assisting in the preparation of false tax returns after prosecutors said he fabricated more than $1 million in fraudulent losses on client tax filings to generate refunds the clients were not entitled to receive.

Cortez Hollis, who owned and operated Hollis Tax Time in Minnesota, told clients he could secure tax credits other preparers didn’t know about, according to court documents. In reality, prosecutors said, Hollis reported fictitious businesses on the returns, claiming thousands of dollars in phony business losses to inflate refunds. He then paid himself preparation fees of $2,000 or more out of the resulting refunds — sometimes without the knowledge of his clients, prosecutors said.

At trial, the government established that Hollis added more than $1 million in fraudulent losses to client tax returns and sought approximately $387,000 in refunds the clients were not entitled to receive, according to court documents.

“No matter the scheme, the agency, or the program involved, those who cheat on their taxes for personal enrichment undermine the very foundation of public trust,” said Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division. “The Fraud Division is working across all fronts to detect, investigate, and prosecute criminal tax violations. We will protect the integrity of our tax system and ensure that those who seek to enrich themselves at the expense of honest citizens face the full weight of federal prosecution.”

Hollis was convicted on all 20 counts of aiding or assisting in the preparation of false tax returns. Sentencing has not yet been scheduled. He faces a maximum penalty of three years in prison for each count, though a federal district court judge will determine the actual sentence after weighing U.S. Sentencing Guidelines and other statutory factors.

The case was investigated by IRS Criminal Investigation, the Justice Department said. Assistant Chief Eric B. Powers and Trial Attorney Megan E. Wessel of the Criminal Division’s Tax Section are prosecuting.

The announcement was made by Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division and U.S. Attorney Daniel Rosen for the District of Minnesota.

The conviction is part of a broader push by the Justice Department’s National Fraud Enforcement Division, which was established April 7 to investigate and prosecute fraud against the American people, the department said. The division’s work supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste and abuse within federal benefit programs.