Local Pastor Swindles More Than $1 Million From State

Hester targeted immigrants and those who did not understand the tax system.

Image Credit: Department of Revenue Facebook

MINNEAPOLIS — A local pastor has been charged with 18-counts of tax related felonies according to a Minnesota Department of Revenue release.

Annie Mae Hester, 69, was charged with 11 counts of knowingly preparing fraudulent tax returns, six counts of purposely evading income tax by refusing to file returns or filing with false information, and one count of theft by swindle. The complaint alleges Hester, a pastor at Holsey Memorial Church in Minneapolis, hustled approximately $1.4 million from the state of Minnesota.

Hennepin County Attorney Mike Freeman told Fox 9, “This is a big deal swindle.” 

The scheme goes back to 2010, when Hester ran a tax prep business out of Brooklyn Center, MN. Hester allegedly falsified information on tax returns for clients so they would get a larger return. Hester minimized the taxable income of her clients by reporting business losses that did not exist, charitable deductions, and business and medical expenses that were not reimbursed. The Department of Revenue audits of Hester’s clients show they owe an average of $5,600 in back taxes, penalties, and interest, the complaint notes.

“She had them claiming all sorts of business deductions, business losses, charitable deductions when these people simply didn’t have the money to do this,” Freeman told Fox 9.

Hester targeted immigrants and those who did not understand the tax system, the release notes. She had anywhere from 500 to 700 clients annually, charging them $100 to $300 per return.

Now all the clients owe the state in back taxes, interest, and penalties, because the clients are liable for any discrepancies, Fox 9 reports, noting that one couple owes more than $8,000, and has monthly payments to avoid a lien on their home.  

Hester also failed to file her own income taxes in 2011, 2012, and 2015, according to the complaint, while falsifying her returns for years 2013 and 2014. The release determines that Hester allegedly owes the state approximately $58,000 in back taxes, penalties, and interest.

The Department of Revenue reports each felony carries a maximum five year jail sentence and/or $10,000 in fine. Hester could also face an additional 20 years and/or $100,000 in fines for swindling the state. Overall, Hester could face 105 years in prison and/or $270,000 in fines.

Preya Samsundar

Preya Samsundar was born and raised in Minneapolis, MN. She graduated from the University of Minnesota - Twin Cities this Spring with a B.A. in Political Science and Sociology, with a minor in Strategic Communications. Preya has previously worked on several State Campaign Races.