KC realtor indicted for tax evasion, COVID-19 loan program fraud
KANSAS CITY, Mo. — A Louisburg, Kansas woman is charged with tax evasion and wire fraud after a federal grand jury in Kansas City return an indictment this week.
The indictment alleges that Michelle O’Connor owned and operated a realty company based in the Kansas City area.
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According to a news release from the U.S. Department of Justice, for tax years 2008 through 2015, O’Connor filed federal income tax returns, self-reporting that she owed approximately $300,000 in taxes. Despite acknowledging she owed the taxes, O’Connor did not pay them.
In 2011, the IRS audited her 2008 and 2009 tax returns and concluded that O’Connor had improperly claimed tens of thousands of dollars in personal expenses as charitable deductions to the “Church of Revelation and Love,” a purported church she and her husband created and were, along with her family, its primary members. Based on that audit, the IRS assessed over $40,000 in additional taxes against O’Connor.
Starting in 2011, the IRS began trying to collect the outstanding taxes from O’Connor, sending her over 50 notices regarding them. From 2011 through 2023, however, she tried to stymy the IRS’s collections efforts by, among other things, filing three separate false and frivolous bankruptcy petitions, purchasing approximately $250,000 of cashier’s checks to reduce her bank account balances, and closing her personal bank accounts and using her business’ bank accounts to pay personal expenses.
By 2020, O’Connor owed the IRS nearly $500,000 in taxes, penalties, and interest.
Court documents say she submitted 34 fraudulent COVID-19 Economic Injury Disaster Loan (EIDL) applications on behalf of her real estate business and seven other corporate entities she created for the purpose of maximizing potential EIDL credits.
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According to the DOJ, under the EIDL program, a small business could receive a loan of up to $150,000 from the Small Business Administration to cover six months of working capital.
In total, O’Connor received nearly $300,000 from her fraudulent EIDLs, which she used for personal purposes, including $115,000 to purchase cryptocurrency.
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