Auburn, ME – October 14, 2026 (STL.News) A Maine tax preparer has pleaded guilty to federal tax fraud and wire fraud charges after admitting that he filed fraudulent tax returns for clients, claimed improper tax benefits, and secretly diverted portions of their refunds into his own hands, according to the U.S. Department of Justice.
Thierry Musese, who ran a tax preparation business out of a barbershop in Auburn, Maine, pleaded guilty on October 7, 2026. Federal prosecutors announced the development Wednesday, October 14, describing a scheme involving fabricated business losses, improper tax credits, and unauthorized transfers of clients’ money.
The case highlights the potential financial consequences when taxpayers entrust their personal information and federal income tax filings to dishonest preparers.
According to the Justice Department, Musese continued preparing false returns even after the Internal Revenue Service revoked his electronic filing credentials. He also submitted fraudulent personal income tax returns.
Musese pleaded guilty to three federal offenses: aiding and assisting in the preparation of a false tax return, filing a false personal tax return, and wire fraud.
He faces a statutory maximum of three years in federal prison for each tax offense and up to 20 years for wire fraud. Those penalties represent the maximum authorized for the offenses, not a prediction of the sentence he will receive.
A federal district court judge will determine his punishment after considering federal sentencing guidelines and other applicable factors.
Tax Preparation Business Operated From a Barbershop
Federal authorities said Musese conducted his tax preparation operation from a barbershop in Auburn, a city in Androscoggin County, Maine.
The arrangement allowed him to provide tax preparation services to clients who relied on him to report their income, deductions, and credits accurately to the federal government.
Federal prosecutors say Musese prepared fraudulent returns for the 2021 and 2022 tax years. The filings included false financial information intended to generate refunds to which taxpayers were not legally entitled.
The improper entries included fabricated business losses, false fuel tax credits, and residential energy credits that did not qualify under federal tax rules.
Each type of misrepresentation can improperly reduce a taxpayer’s reported federal income tax liability or increase the refund claimed.
For example, business losses may reduce taxable income when they arise from legitimate business activities and meet applicable tax requirements. Inventing losses that never occurred can artificially lower a tax bill.
Fuel tax credits are available only under specific circumstances established by federal law. They generally concern qualifying uses of fuel rather than ordinary personal vehicle expenses.
Residential energy credits similarly depend on qualifying expenditures and other statutory requirements. Claiming credits without eligible expenses can create an improper tax benefit.
Prosecutors said the false information Musese placed on client returns produced inflated refunds.
Clients’ Tax Refunds Diverted Without Authorization
Beyond filing inaccurate returns, Musese admitted to taking portions of clients’ tax refunds without their knowledge or permission.
The unauthorized diversion of refund money made the case more than a conventional false-return prosecution.
Federal investigators identified conduct that affected both the integrity of the federal tax system and the financial interests of individuals who relied on Musese to handle their tax filings.
When a tax preparer submits false information to the IRS, clients may face questions about the accuracy of their returns, even when they were unaware of the preparer’s misconduct.
The additional diversion of refunds creates a separate financial injury because clients may not receive the full amount of money associated with their tax filings.
The Justice Department did not specify in its October 14 announcement the total amount Musese diverted from clients or the combined dollar value of the improper refunds.
The announcement also does not identify the individual clients affected by the scheme.
Original Indictment Identified 17 Taxpayers
The federal investigation became public in February 2025, when the Justice Department announced that a grand jury had indicted Musese on charges involving fraudulent tax preparation and the alleged theft of client refunds.
According to that announcement, the indictment alleged that Musese prepared and filed false federal income tax returns for 17 taxpayers during the 2021 and 2022 tax years.
Those allegations included false business losses, fuel tax credits and residential energy credits.
The original indictment also alleged that Musese gave some clients copies of tax returns that differed from the versions actually submitted to the IRS.
Such discrepancies can prevent taxpayers from recognizing unauthorized information included in their federal filings.
The indictment further alleged that Musese continued preparing false returns for the 2023 tax year after the IRS revoked his electronic filing identification number.
The February 2025 charges were allegations when they were filed. The October 2026 guilty plea establishes Musese’s admission to the three offenses identified in the Justice Department’s latest announcement.
The original indictment’s reference to 17 taxpayers provides background on the investigation but should not be interpreted as a separate admission that the guilty plea established every allegation involving every taxpayer.
Continued Filing After IRS Revoked Credentials
One significant aspect of the case involves Musese’s continued preparation of fraudulent returns after federal tax authorities revoked his electronic filing credentials.
The IRS uses electronic filing identification numbers to identify businesses and individuals authorized to participate in its electronic filing program.
Revocation of those credentials removes a preparer’s authorization to participate in that program under the revoked identification number.
According to the Justice Department, Musese continued preparing false tax returns despite the revocation.
The conduct raises broader concerns about taxpayers’ ability to evaluate the legitimacy of individuals offering professional tax preparation services.
Taxpayers may assume that someone advertising tax preparation services has the necessary credentials and complies with federal filing requirements.
However, the availability of a tax preparation service does not independently establish that the person operating it is authorized to electronically file returns or that the information submitted will be accurate.
The Musese prosecution illustrates why taxpayers should independently review their returns and confirm the identity and qualifications of the person preparing them.
Federal Charges and Potential Prison Sentence
Musese’s guilty plea covers three distinct federal crimes.
The first offense, aiding and assisting in preparing a false tax return, concerns his role in producing fraudulent tax information for another taxpayer.
The second offense, filing a false tax return, involves his own federal income tax reporting.
The third offense, wire fraud, involves fraudulent conduct related to client refunds.
Federal prosecutors said the two tax offenses each carry a maximum prison sentence of three years, while the wire fraud offense carries a maximum of 20 years.
Although those statutory maximums total 26 years, the actual sentence will depend on the court’s assessment of the offenses, applicable sentencing guidelines, and other statutory considerations. The court will also determine whether any prison terms run concurrently or consecutively.
No sentencing date was provided in the October 14 Justice Department announcement.
The guilty plea means the case has moved beyond the indictment stage, but sentencing remains a separate judicial proceeding.
IRS Criminal Investigation Led the Case
The Justice Department identified IRS Criminal Investigation as the federal agency responsible for investigating Musese’s conduct.
IRS Criminal Investigation investigates potential criminal violations involving federal tax laws and certain related financial offenses.
Unlike routine civil tax examinations, criminal tax investigations can result in federal prosecution when authorities develop evidence supporting criminal charges.
Assistant Attorney General Colin M. McDonald of the Justice Department’s National Fraud Enforcement Division and U.S. Attorney Andrew B. Benson for the District of Maine announced the guilty plea.
Trial Attorney Likhitha Butchireddygari of the National Fraud Enforcement Division’s Tax Section and Assistant U.S. Attorney Sean Green for the District of Maine are prosecuting the case.
The prosecution shows how preparing false tax returns and unauthorized diversion of refund payments can lead to multiple federal criminal charges arising from related conduct.
Case Comes During Nationwide Tax Fraud Crackdown
The Musese guilty plea was announced on the same day that the Justice Department disclosed the results of a broader national tax fraud enforcement initiative.
On October 14, federal officials reported enforcement actions involving 76 defendants and alleged or established conduct associated with more than $490 million in estimated intended federal revenue losses.
The national initiative involved the Justice Department’s National Fraud Enforcement Division, IRS Criminal Investigation, and U.S. attorneys’ offices nationwide.
Federal officials said the enforcement effort included new criminal charges, guilty pleas, trials and sentencings.
Those actions involved different defendants and schemes, ranging from fraudulent refund claims to alleged failures to pay employment taxes.
The $490 million figure represents the combined estimated intended loss associated with the national initiative. It is not the amount attributed to Musese, whose individual loss figure was not specified in the October 14 guilty plea announcement.
The Maine case illustrates the types of misconduct federal investigators are targeting as part of broader efforts to address tax fraud.
What Taxpayers Can Learn From the Case
The guilty plea underscores the importance of reviewing federal tax returns before authorizing their submission.
Even when a paid preparer completes the paperwork, taxpayers should understand the basic information being reported in their names.
Unfamiliar business losses, unusually large refundable credits, or claims involving expenses the taxpayer never incurred may warrant additional scrutiny.
Taxpayers should also verify that their refunds are directed to bank accounts they recognize and authorize.
A preparer who refuses to provide a complete copy of a return, discourages clients from reviewing its contents, or promises unusually large refunds without explaining the underlying tax treatment may present warning signs.
The IRS offers resources to help taxpayers select qualified tax professionals and understand the responsibilities associated with paid tax preparation.
Taxpayers can also use IRS online account services and official tax transcripts to review information associated with their federal filings.
Those safeguards cannot eliminate every instance of fraud, but they can help individuals identify discrepancies before or after a return is submitted.
Sentencing Remains the Next Step
Musese now awaits sentencing in federal court following his October 7 guilty plea.
The Justice Department has not announced a sentencing date, a restitution order, or a final calculation of the case’s financial losses.
The court may address those issues in subsequent proceedings.
For now, the confirmed outcome is that Musese admitted to federal tax preparation fraud, filing a false personal tax return, and wire fraud involving clients’ refunds.
The prosecution reminds us that fraudulent tax preparation can affect both federal revenue and the taxpayers who depend on professionals to handle their financial information accurately.
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