A Jefferson Parish couple who own a check-cashing business in Kenner have been indicted by a federal grand jury on charges they cashed fraudulent tax refund checks for foreign nationals and grossly underreported their income to the Internal Revenue Service.
Susantha “VJ” Wijetunge, 51, and his wife, Manula “Manu” Wijetunge, 47, face more than two dozen counts, including conspiracy to commit money laundering, filing misleading reports with the government regarding financial transactions and making false tax returns.
The fraudulently obtained tax refund checks were issued in the names of stolen, fake and purchased identities, according to federal authorities.
The indictment was handed up Thursday in U.S. District Court in New Orleans, some three months after federal agents raided the couple’s home and their business, VJ Discount, on Veterans Memorial Boulevard.
A day before the charges were filed, the Wijetunges submitted a lengthy court motion complaining that the government unlawfully seized some $6 million of their personal and business assets. They said their children had been handcuffed as the authorities “ransacked” their business in search of evidence.
Federal authorities accused the Wijetunges of taking measures to obscure their financial records, including filing fraudulent currency transaction reports — required for any transaction involving more than $10,000 — that falsely reported the names of payees and the amount of money paid out. The couple allegedly stored large amounts of cash at their home and in a safe deposit box. Some of the illicit proceeds appear to have made their way into accounts overseas, the government said.
“The scope of VJ’s criminal activity was extensive,” Matthew Reidell, a special agent with Homeland Security Investigations, wrote in an application for a search warrant, noting the business was incorporated in 1996. “Analysis of bank accounts operated by VJ shows that millions of dollars in these fraudulently obtained tax refund checks were cashed at VJ Discount over the course of this investigation.”
According to Reidell’s affidavit, a group of “co-conspirators,” many of whom have pleaded guilty and are cooperating in hopes of receiving reduced sentences, would fraudulently endorse tax refund checks in front of VJ Wijetunge, “signing multiple different names on the backs of checks that were made payable to multiple different individuals.”
The owners of the check-cashing business were aware of the scheme, authorities said, and increased their fee from 1 to 2 percent to between 8 and 10 percent when cashing fraudulent tax refund checks. “VJ was aware that the scheme involved some risk of detection by law enforcement,” Reidell wrote.
The Wijetunges also are accused of underreporting income to the IRS. Reidell, in his search warrant application, wrote that VJ Discount, which also is a convenience store, likely took in hundreds of thousands of dollars a year in check-cashing fees alone, “using even the most conservative accounting.”
“For tax years 2010-2013, however, VJ Discount’s corporate income tax returns reported income of less than $200,000 per year and ordinary income (profits) of only tens of thousands per year,” Reidell wrote.
In their court filing this week, the Wijetunges contended that the allegedly fraudulent tax return checks they cashed were legitimate.
“The government has produced little evidence to suggest that the Wijetunges or anyone at VJ Discount knew there was any problems with the checks,” their attorneys wrote.
Court filings show the investigation is related to the case of Jaqueline Arias, a tax return preparer from Alabama who pleaded guilty last year to a money laundering and false tax return conspiracy. That case involved “a criminal organization involved in purchasing IRS Forms W-2 and stolen identities,” Reidell wrote.
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