Telugu Man Guilty in $2.7 Million Scam in U.S.

An Indian-American financial planner from Cleveland, Ohio, pleaded guilty to conspiracy to defraud the United States and filing a false tax return. The planner, Rao Garuda, a Telugu guy who graduated from Andhra University, was involved in a scheme called the Advanced Legacy Plan or the Ultimate Tax Plan, which aimed to help high-income individuals illegally reduce their taxes.

The scheme involved transferring assets to a limited liability company (LLC), giving ownership to a charity run by co-conspirators, and claiming a tax deduction for charitable contributions.

Rao Garuda, the President and CEO of Associated Concepts Agency (ACA), was accused by federal prosecutors of offering a tax shelter to affluent clients through deceptive charity contributions.

Despite attorneys’ warnings that the scheme was illegal, Garuda promoted it. He also assisted clients in backdating documents to claim tax deductions after the tax year ended. Garuda caused a tax loss of over $2.7 million and agreed to pay restitution. He is scheduled to be sentenced and faces potential prison time, supervised release, restitution, and monetary penalties. The IRS Criminal Investigation Department is investigating the case.