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Tax prep office raided in prepaid debit card scam

April 18, 2012 3:19:32 PM PDT
The city and state took action after an Eyewitness News investigation this week.

People were showing up to a local office because they were promised prepaid debit cards.

Wednesday, investigators were there, but they were taking out evidence.

Eyewitness News watched Wednesday morning as state tax criminal investigators and NYPD cops raided the office of E and M Multi Services in the Bronx, hauling out computers and boxes of records belonging to the owner.

When Eyewitness News confronted owner Mark Goldberg the other day he maintained, "I do tax returns."

"It was a large scam. You could collect millions of dollars over a couple of months," Deputy Inspector Christopher McCormack said.

It was an alleged scam that had customers lining up for weeks outside the storefront, willingly handing over copies of social security and Medicaid cards and state IDs, believing they would get government stimulus money placed on prepaid debit cards.

Most customers told Eyewitness News they never got money on the cards.

Law enforcement sources say they believe Goldberg falsified information on tax returns or submitted fraudulent returns to get refunds he would keep for himself.

For several days Eyewitness News tried to get answers to questions but were blocked by Goldberg's security team.

His operation was shrouded in secrecy but it was all exposed Wednesday.

Even his employees now say they were victims too.

Goldberg is now under arrest.

"He said, 'You are on public assistance, I can get you $5,000. I will file you as self employed, I will get you your paperwork stating that you work wherever,'" said Norka Montanez, a customer.

She says she balked and that Goldberg threatened her.

"He threatened he was going to put me as non-payment for using his services," Montanez said.

Most people Eyewitness News they never got money on those prepaid cards, but some did, not realizing that tax returns were being filed for them.

Michael Schepp called state authorities after the raid on Goldberg's office.

"You found out now that he gave you a college credit?" Wallace asked.

"Yes, that's correct," said Michael Schepp, a customer.

"And you weren't entitled to it," Wallace said.

"No, no I wasn't and I'm willing to pay back whatever money obviously, but they're not worried about that, they're worried about shutting them down obviously," Schepp said.

"How do you look at what he's done to everyone?" Wallace asked.

"It gives the people some false hope I guess, that they were entitled to the money but they really weren't," Schepp said.

People affected should contact The State Department of Tax and the IRS.

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