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Thursday, November 2, 2000

Three brothers plead
guilty to tax fraud

Star-Bulletin staff

Three brothers who operated Fortune Designs Collection Corp., which sold T-shirts at flea markets, pleaded guilty to defrauding the Internal Revenue Service.

David Chang, 42, the corporation's president, admitted he knowingly signed and filed false personal and corporate income tax returns that did not report $27,615 in 1991 and $25,383 in 1992.

He also admitted he was assisted in the scheme by his brothers Alan and Simon Chang, and Brian I. Tanoue, the corporation's accountant.

Alan Chang, 40, acknowledged he did not report $35,368 of business receipts and merchandise he diverted from the corporation in 1991. Simon Chang admitted to not reporting $46,151 during the same period.

U.S. District Judge Susan Oki Mollway will sentence the men, who are free on bail, in April of 2001.

Tanoue will be tried Feb. 6, 2001 on multiple counts of conspiring to defraud the IRS and also aiding and assisting in the preparation of false income tax returns.

Tax preparer
charged with filing
false returns

Star-Bulletin staff

Rosalinda DeGuzman has been charged with multiple felony and theft violations for preparing false income tax returns for her clients by overstating itemized deductions, according to Tax Director Marie Okamura.

She was also charged with theft in the second and third degrees for her preparation of false tax returns which caused her clients to receive larger refunds than they were entitled to receive, Okamura said.

In total, an Oahu grand jury indictment charged DeGuzman with 16 counts of false and fraudulent statements, aiding and abetting, seven counts of theft in the second degree and seven counts of theft in the third degree.

All charges are Class C felonies. The tax charges, upon conviction, carry a fine of as much as $100,000 or imprisonment of not more than three years, or both.

The theft charges carry a fine of up to $10,000 or imprisonment of not more than five years, or both.

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