The federal indictment against an American Samoa woman charged in Alaska for using local residents’ tax records in order to get large refunds from the Internal Revenue Service is “only the tip of the iceberg.” According to local Treasury Department officials, federal investigators are seeking more information on the illegal practice of American Samoans filing taxes in the U.S. when they did not earn any income in the U.S.

Samoa News reported yesterday that 58-year old Pepe Anetipa was indicted late last month for making false, fictitious, and fraudulent tax claims against the U.S government. She was arrested Dec. 2 in Washington State and arraigned last week at the federal court in Anchorage, Alaska where she pleaded not guilty.

“The federal indictment is just the tip of the iceberg,” said former Tax Office manager Melvin Joseph, who is currently the Treasury’s tax consultant. It was during Joseph’s tenure as Tax Manager when the issue of local residents filing taxes off island first surfaced several years ago.

Meanwhile, the federal prosecutor has declined to comment further on Anetipa’s case because some of the issues raised by Samoa News are not in Anetipa’s indictment and therefore are not public record.

For example, it’s not clear from Anetipa’s indictment, if any of the American Samoa residents whose tax records were used by Anetipa, gave the defendant permission to file their taxes with the IRS— or if the tax payers were aware of it all along.

Samoa News also asked if Anetipa shared any of the more than $200,000 in tax refunds with the American Samoa residents whose tax records she used, or did she keep all of that money?  Another question arose: if the defendant shared the money with the American Samoa residents involved, did she send a check via Postal Service or was it wire transfer, or direct deposit into a bank account?

“I do know the answers to those questions, but because the information is not in the indictment, it is not public, and I am not permitted to disclose it at this time,” was the response yesterday from federal prosecutor Thomas Bradley.

However, Bradley is quoted by Anchorage based KTUU-TV saying that while Anetipa held on to much of the money from the scheme, some of it was paid as kickbacks to the original taxpayers.

“Some of the money was shared with taxpayers she knew,” Bradley said. “Sometimes she kept it all and sometimes she kept a part of it.”

While it’s not clear whether any or all of the taxpayers are criminally culpable in the scheme, Bradley said no further charges are immediately planned beyond those against Anetipa, according to KTUU.

Joseph told Samoa News yesterday that the local tax payers “could very well be the ones suffering” from this scheme of filing in the U.S.— if the tax preparer in the U.S. keeps a large percent, or the entire amount of the tax refund.

He recalled for Samoa News that he and former Gov. Togiola Tulafono over the years have warned residents many times not to file taxes in the U.S. if no income was earned in the U.S., because “it’s illegal” but such warnings were ignored. Joseph expects to see more people face federal charges on this same issue.

“Perhaps the main reason that local tax payers didn’t heed past warnings was due to the fact that no charges were ever filed by the federal government and therefore people just keep doing the same illegal practice,” a former senior government official, who knew of residents who filed taxes in the U.S, told Samoa News yesterday after reading the indictment story.

“Now that this federal indictment is filed and the tax preparer charged, people are nervous and wondering what’s coming down the line for them,” the former ASG official said yesterday, adding that “justice might be late but justice will be served.”

The official, who only spoke with Samoa News if not identified by name, said the government lost out on revenue because of “greedy” tax payers, who filed taxes in the U.S. “knowing very well that this is illegal and should be stopped.”

Several weeks after the Lolo Administration took office in January last year, the late Treasurer Dr. Falema’o ‘Phil’ Pili issued a notice about the considerable amount of local tax payers filing their local income tax returns off island with the IRS mainly to get large tax refunds, through the federal Earned Income Tax Credit, to which American Samoa and other territories are not entitled.

When asked yesterday for comments on the federal case involving local tax payers, the current Tax Office manager, Richard Jimmerson said this is “something that has been ongoing for a long time,” adding that the FBI and the IRS are seeking more information dealing with residents filing taxes in the U.S.

“Interest from the FBI and IRS has increased in the past months to help clean up this problem,” he told Samoa News and issued a verbal warning for American Samoa tax payers not to file taxes in the U.S. because it’s illegal.

Jimmerson says local taxpayers are only authorized to receive money under the Additional Child Tax Credit (ACTC), which is funded by the IRS.

As part of the federal probe, investigators are also expected to look into bank statements of individuals to identify large and unusual bank deposits, if such funds came from IRS issued tax refunds, he said.

The 28 counts against Anetipa are for the 28 people from American Samoa for which she prepared and filed false tax returns with the IRS.

Anetipa, who moved to Alaska in the summer of 2012 and operated a licensed tax preparation business the following year, is alleged to have filed falsified tax returns claiming total refunds of at least $202,859. She is accused of using tax information of American Samoa residents to file taxes with the IRS in order to obtain those refunds.