D.C. tax office under investigation for missing millions

While most GW students were still roaming the halls of their middle schools, a corruption case with potential to be the largest in local government history was brewing in the District.

The D.C. Office of Tax and Revenue has been under been under investigation by the U.S. Attorney’s office in Washington, after it discovered millions of dollars in questionable property tax refunds.

The office allegedly made checks out to companies for large tax refunds – but many of the companies appear not to exist.

Analysis shows that this scandal could go as far back as 1999, according to The Washington Post, and D.C. taxpayers might have had as much as $44.3 million used towards these suspicious refunds, according to the latest estimate.

Another point of contention is that the D.C. Mayor Adrian Fenty’s current Chief Financial Officer Natwar M. Gandhi headed the Office of Tax and Revenue when the suspect refunds started being issued.

“The mayor is saying there is no reason to involve the CFO,” said Dan Keating, a Pulitzer Prize-winning investigative journalist and Washington Post database editor working on this developing story.

There continues to be speculation over whether Gandhi will be under investigation along with those already charged – Harriette Walters, Diane Gustus and others.

Walters, 51, who was formerly the manager in charge of property tax refunds and Gustus, another tax employee, are charged with signing off on checks made out to fictional companies controlled by members of Walters own family.

On June 9, 2000, a check of more than $181,000-was signed off to “Bellarmine & Associates,” one such fictitious operation, according to The Examiner. In 2006 a $346,700 check was made out to another fictitious company called “Bilkemor LLC,” according to the Post. These are just a few of the dummy corporations purportedly set up to take the money from the pockets of D.C. taxpayers and put it in the bank accounts of Walters and his co-conspirators.

Checks were also made out to real estate lawyer Jeffrey Nadel and attorney David Fuss. When confronted, both men denied having any involvement in the activities and were confused as to why their names appeared on the fraudulent checks.

Walters has confessed to her actions and admits that she signed each and every voucher, according to The Post. She is being held without bail until all the stolen funds can be located.

Keating said the Post’s analysis of city documents was in response to a Nov. 8 FBI raid on the Office of Tax and Revenue. He added that 15 employees of the office have already lost their jobs and a criminal investigation is pending.

“The main question is, ‘Who is going to be held responsible?'” Keating said in a phone interview.

Natalie Wilson, spokesperson for the Office of the CFO, was not able to be reached for comment.

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