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Burbank man named in tax fraud scheme

Marine reservist pleads guilty in scheme involving false travel expenses, tax avoidance.

November 06, 2013|By Alene Tchekmedyian, alene.tchekmedyian@latimes.com

A 29-year-old Burbank man was among dozens of members of the U.S. Marine Corps Reserve reportedly involved in a tax fraud scheme in which they collectively received nearly $900,000 in fraudulently obtained travel and lodging payments, officials said.

The Burbank man — identified in court records as Cpl. Aaron Payton — pleaded guilty last week to one count of failure to pay taxes and is slated to be sentenced in January.

According to court records, Payton was entitled to receive travel and lodging expenses if he lived 50 miles or more away from his Long Beach station, where he was on active military duty in 2008 and 2009.

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During those years, he received — and failed to report — nearly $30,000 from the Defense Finance and Accounting Service based on fraudulent claims for travel and lodging expenses, according to his plea agreement.

At least $7,000 was used to give kickback payments to another reserve member who prepared and submitted fraudulent travel and lodging claims, including fake hotel receipts, in Payton’s name.

Additionally, the reservist who filed the false claims, identified by authorities as Bladimir Flores, would often list fake home addresses on the forms he filed to make it look like the claimants lived beyond a reasonable commuting distance from their station.

Payton owed $2,183 in taxes, which he didn’t pay, according to the document.

The scheme, in which 28 marine reservists received at least $874,572 in fraudulently obtained travel and lodging payments, resulted in a $121,498 tax loss to the government.

Payton faces a maximum of one year in prison.

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Follow Alene Tchekmedyian on Google+ and on Twitter: @atchek.

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