Police say they are investigating the case of a tax preparer who apparently disappeared during tax season — and at least one client alleges the preparer took her money to prepare her tax returns without filing the paperwork with the Internal Revenue Service.
Detective Paul Mangus recently confirmed that the Hawaii Police Department’s East Hawaii Criminal Investigations Section has received “at least 20” complaints and is investigating the tax preparer Hilo Income Tax Service and its enrolled agent, Michele Slone.
“I got my first complaint in late May,” Mangus told the Tribune-Herald. “As far as I know, she’s not on the island. Through my investigation, that’s what I’m discovering. And that’s kind of where I’m at.”
Mangus said that at this point, police don’t know where Slone is and don’t have enough evidence of a crime being committed to file formal charges.
“Right now, a lot of these cases, it seems like it’s a civil matter,” he said. “What I’m trying to find out is if taxes have been filed on (complainants’) behalf, or not.”
A small claims civil case was filed on June 1 in Hilo District Court by Haunani Saraos. The filing is seeking $413.12 Saraos claims she paid to Slone on April 7 to prepare a joint tax return for Saraos and her husband.
“I believe that this business owes me money because I paid for her services to do our taxes on this day, but she did not do what I signed for,” Saraos’ complaint states. “She printed out a paper (she) made me and my husband sign saying she did our taxes electronically, but I have called the IRS on May 9. They said they have nothing for us on file.
“I’ve gone to her for a couple of years. She’s been good. I just don’t know what happen(ed) this time. I trusted her. I’ve tried emailing her and asking for a refund there, but she doesn’t answer. … I also have the receipt that she gave me when I paid and the other papers that she gave me when I paid … that said she did our taxes, but she did not.”
A hearing in Saraos’ case has been set for July 26.
The small claims suit isn’t the first time Slone has been the subject of civil litigation in money matters.
A claim against Slone filed on Feb. 27, 2021, by OneMain Financial resulted in Slone missing a court hearing on Nov. 10, 2021 — despite being served with a summons on Oct. 29 that year — and a default judgment for the plaintiffs for $13,869.09. It’s unclear if that debt has been collected.
And the state Department of Labor and Industrial Relations filed a complaint in Hilo Circuit Court against Slone on July 6, 2021, claiming that she owed a former employee, Donna Degele, an office administrator, $16,562 in unpaid wages and mileage from more than a decade earlier.
“Defendant has to date failed, despite repeated requests, to pay the unpaid wages owed to claimant,” the document states.
The suit — which sought the unpaid wages, plus penalties, interest and process servers’ fees — resulted in a default judgment against Slone of $53,463.64.
One woman, who spoke to the Tribune-Herald on condition of anonymity, said she paid Sloan $287.95 on April 13. The woman said the check was cashed, but her return went unfiled.
“I went down there. I went into a long, long, long line. Michele was actually there that day. I saw her walk into the door,” the woman said. “You know how they can take their payment out of your return? Well, there was a big sign that said you’ve got to make the check payable to (Hilo Income Tax Service). You cannot do it through your tax return anymore. That’s something I noticed that was different.”
The woman said she became concerned when a co-worker who did her own taxes later got her tax return first. So, the woman emailed Hilo Income Tax Service, and one of Sloan’s employees filed the return after being prompted.
“She said everything was completed, (Slone) just didn’t file,” the woman said of the company employee. “So (the employee) filed the papers, but it was after the due date. So, I had to pay a penalty, because it was after the fact.”
There also have been six complaints filed this year through the state Department of Commerce &Consumer Affairs Office of Consumer Protection. One resulted in a civil settlement on May 27, while the remaining five have the notation “Outcome: This is a pending complaint. No further information is available.”
In addition, there have been numerous complaints about Slone on social media.
Mangus said he’s unaware of any investigations against Slone or Hilo Income Tax Service by either the state attorney general or the FBI.
Asked if Slone has kept any money from client’s tax returns, Mangus replied, “As far as I know, she’s not.”
“If she had, we’d be running into some criminal cases, but right now, there’s no criminal cases,” he said.
Those with potential theft complaints to be investigated can call the police nonemergency number at (808) 935-3311. Business complaints can be filed with the DCCA online at https://cca.hawaii.gov/businesscheck/.
Email John Burnett at jburnett@hawaiitribune-herald.com.