Expert: Consuelo Herrera, International Accountant and Fraud Examiner - 7/1/2009

Question
Hi,
I was recently working with a company that does not report about 95% of their cash intake. They have the receptionists put any cash payments in an envelope on the side. If a cash payment is mistakenly entered into the Quickbooks we were to void it. Maybe a couple of cash payments were put through in order to make it look like they are on the up and up. Her accountant helps her conceal this. Not only is this company not reporting their cash intake but they also have not been paying their Unemployment Insurance.  How do I report this? my ex boss is pocketing all this money, taking vacations and trips, and now I can't get Unemployment Benefits because she wasn't paying her insurance.

Thank you,
Ivette

Answer
Dear Ivette,


I am so sorry to hear that this fraud scheme is affecting you. I am happy though that you are taking steps to stop this.

How Do You Report Suspected Tax Fraud Activity?
 
If you suspect or know of an individual or company that is not complying with the tax laws, you may report this activity by completing Form 3949-A. You may fill out Form 3949-A online, print it and mail it to:

Internal Revenue Service
Fresno, CA 93888

If you do not wish to use Form 3949-A, you may send a letter to the address above. Please include the following information, if available:

Name and address of the person you are reporting
The taxpayer identification number (social security number for an individual or employer identification number for a business)
A brief description of the alleged violation, including how you became aware of or obtained the information
The years involved
The estimated dollar amount of any unreported income
Your name, address and daytime telephone number
Although you are not required to identify yourself, it is helpful to do so. Your identity can be kept confidential.


Some widely used resources are the Better Business Bureau (www.bbb.org) and the national fraud center (www.fraud.org)

Also you should contact the local police to find some guidance on how to proceed.

I am glad you are helping other to be victimized.

I would love to know the outcome of your report. If you have further questions, feel free to write back.

I wish you success in your quest for justice.


Sincerely,


Consuelo Herrera, CAMS, CFE