BRONX, N.Y. — Rafael Alvarez, a tax preparer from the Bronx nicknamed “the Magician,” was arrested by agents from IRS Criminal Investigations in connection with an alleged tax fraud scheme that has reportedly defrauded the government of over $100 million.
Charged on Monday morning with federal tax and conspiracy offenses, the 60-year-old Alvarez is accused of submitting thousands of fraudulent tax returns over more than a decade, generating more than $15 million in revenue for his firm, ATAX New York.
“While Alvarez may have been known as ‘the Magician,’ he can’t say abracadabra and make these charges disappear,” stated IRS-CI Special Agent in Charge Thomas Fattorusso. “Today’s arrest was no magical illusion, and Alvarez now faces the reality of his actions.”
A spokesperson for ATAX New York claimed that Alvarez had “retired” and was no longer affiliated with the firm, but hung up when questioned about the fraud allegations.
Federal prosecutors characterized the scheme as one of the largest tax fraud operations ever perpetrated by a single tax preparer. FBI New York Director James Smith referred to it as “a deliberate slight against the integrity of our country’s tax system.”
Investigators allege that Alvarez orchestrated a scheme involving the recruitment of clients, during which he and his employees would falsify business deductions and fabricate capital losses to inflate tax refunds.
Residing in Cortland Manor, New York, Alvarez faces multiple charges, including tax fraud, identity theft, making false statements, and conspiracy. He was expected to appear in court on Monday afternoon.
“Alvarez’s sleight of hand was criminal tax fraud, a serious federal tax crime…depriving the IRS of more than $100 million,” remarked U.S. Attorney Damian Williams. “Today’s charges, on Tax Day, should serve as an important reminder to tax professionals that when they try to cheat the public fisc, they will face grave consequences.”
As of now, attorney information for Alvarez is not publicly available.