The Playbook That Government Agencies Use To Get Away With Criminal Schemes

I watched a video about a woman in Arizona (AZ) who had her children stolen by Child Protective Services (CPS).

As I watched the video, my jaw dropped as I realized that CPS in AZ used strikingly similar tactics to violate the laws as the Franchise Tax Board (FTB) in California (CA) used against me. It can’t be a coincidence that my experience was so similar to hers when it was a completely different issue, involving a completely different agency, with completely different circumstances. 

I am starting to realize that there must be a playbook of tactics that government agencies use to extract extra revenue for themselves. Obviously, the specific tactics are customized by the agencies, but the general playbook appears to be identical: 1. Lay a trap, 2. Deny due process 3. Rig the justice system and 4. Have other government agencies cover it up.

The Arizona mom, Sara, and I each decided to fight for our rights via the judicial system. We each gathered evidence for our cases. In my case, I uncovered that the State of CA was running several bona fide criminal schemes to overcharge taxpayers. In Sara’s case, she uncovered that the State of AZ is running bona fide criminal schemes to kidnap children for profit.

Playbook Step 1: The Agency Lays a Trap 

The FTB Trap I Got Caught In Was Filing a Tax Return Late: FTB doesn’t impose penalties the first time you file a return late, but they do charge fees for filing late on all subsequent years. Once you file your first return late, you are vulnerable to having fees imposed on subsequent years. FTB is financially incentivized to make sure that you can’t get the later years filed timely; suddenly FTB habitually makes many “mistakes” on your account that take tremendous effort to rectify, thus causing you to file your subsequent returns late and incur those fees.  

In my case, my husband and I filed our tax year 2010 late. All five estimated tax payments that we’d made for 2010 “disappeared,” as did subsequent payment we made to FTB. FTB aggressively harassed us to rectify the “lost” payments, and it took so much time and effort that it caused us to file tax years 2011 – 2015 late (FTB only imposed penalties on 2011, 2013 and 2014). 

FTB refused to supply records in my court case for tax year 2010 and 2012 because there was no penalty on 2010 or 2012. I have realized that one of the tactics FTB uses to hide their scheme is to put the penalties on a different year than the accounting irregularities occurred. 

The CPS Trap That Sara Got Caught In Was She Had a Baby Born With Health Problems: CPS receives three times the amount of federal funding for medically fragile children than they do for healthy children, so CPS is financially incentivized to pull medically fragile children from their homes: see 11:46 – 12:00 of video linked above. AZ hospitals are financially incentivized to report children to CPS: 13:35 – 15:02. (Also see 1:48:30 – 1:52:45 for more information on federal funding for CPS. In 2014, the last year publicly reported, AZ made over $7 million in bonuses from the federal government for taking children from homes!)

In Sara’s case, her first child was born with several health problems caused by the use of an unsafe drug during labor. Sara’s mom threatened to sue the doctor and the hospital for malpractice. The doctor called CPS to “help” Sara with her with her disabled baby: 6:30 – 11:02. CPS tracked Sara and the baby for several months, then took the boy away from Sara with the false claim of medical negligence: 16:10 – 18:45. In Sara’s case, it was a double bonus for the doctor/hospital, because in addition to the up-front referral fee from CPS, the doctor/hospital was protected from the malpractice claim. 

Sara went on to have three more children. All three were healthy, but they were taken away by CPS. The logic was that she had been deemed unable to care for the eldest baby, so therefore she couldn’t take care of any baby. Additional allegations were made to further justify the removal of healthy babies; CPS never substantiated these allegations: 1:03:00 – 1:05:04

Playbook Step 2: Agency Violates Rights to Due Process

In my case, FTB Violated Their Own Internal Due Process System in Three Ways:

A. FTB Filed a False Wage Garnishments: A wage garnishment was filed against my husband for $6,000 in November 2014 for tax year 2011, despite the fact that FTB acknowledged that they had received and “lost” $13,393 that had been designated for tax year 2011 (the money had been an overpayment from 2010 that was applied to 2011. As stated above, the payments intended for 2010 had “vanished” and thus the money that was to be re-directed from 2010 to 2011 was also “lost”).  The wage garnishment was lifted and re-filed multiple times as FTB “found” the money, “lost” it again, “found” it again… In CA, there is no right to go before a judge to dispute FTB’s claims that monies are owed. FTB can file a wage garnishment against anyone with no proof, and, as discussed below, there is limited legal recourse. 

B. FTB Denied My Right To Protest the Penalties: When a taxpayer is notified that a penalty is about to be imposed, the taxpayer has 60 days to dispute to the imposition of penalty, called a Protest. In my case, FTB “misclassified” all three of my Protests. Thus, my right to Protest was denied for all three years because of FTB’s “mistakes.”

Not everyone’s Protests get lost. I’ve heard from several people who have had their Protest properly identified. In every one of their cases, FTB sent them a letter saying that if they didn’t waive their right to Protest, FTB would impose a $5,000 fine as punishment for exercising their right. This is extortion and coercion. In one case, the gentleman waived his right and FTB imposed the $5,000 fee anyway, so he was double charged penalties (the originally assessed penalty that he was trying to Protest + the extra $5,000 penalty).

C. FTB Improperly Denied My Claims for Refund: I filed an Abatement Request (now called a Claim for Refund) to request a refund of the penalty that was imposed for tax year 2011 because I believed it was falsely imposed. I was working on gathering my documentation together to file a request for refund of penalties for tax years 2013 and 2014. FTB sent me a letter denying me a refund of penalties for all three tax years, despite the fact that I had only requested a refund for 2011. 

I complained to the Taxpayer Advocate that my right to apply for an Abatement Request for tax years 2013 and 2014 had been violated. She responded that I had told GovOps, the regulatory agency over FTB, that I was planning to file an abatement request for tax years 2013 and 2014. She stated that FTB’s denial for 2013 and 2014 was proper because FTB has “loose guidelines” as to what defines an abatement request, and that she considered this complaint about FTB to a different government agency as a valid request to FTB. I then complained to FTB’s Board of Directors; the Board did nothing (5:30 – 6:43 of linked speech).

In Sara’s case, CPS Violated Their Own Internal Due Process System in Two Ways:

A. CPS Seized Child Based on False Allegations: CPS can only pull children out of homes if they deem the home is immediately dangerous for the child. In AZ, no warrant is required to take child out of parental custody. CPS can take any child without proving to a judge that the removal is justified: 1:58:08 – 1:58:54. 

In Sara’s case, CPS told Sara’s assorted pediatric doctors that the baby had been removed from Sara’s custody and to stop working with Sara, but the baby had not been removed. When Sara went to CPS to meet with them about this order to the doctors, CPS filed a false police report in order to justify taking the child: 23:10 – 25:50. 

B. CPS Denied Her Right to An Administrative Appeal: CPS put Sara on central registry as a child abuser after her child was taken. Sara had a right to a hearing before an administrative law judge to dispute being added to the central registry. CPS denied her the right to that hearing by lying and said it was too late because the petition was already filed. Sara later found out the petition had not been filed and they’d lied: 37:20 – 40:24

Playbook Step 3: Rig the Justice System to Deny Rights

In my case, FTB rigged the justice system in six ways:

A. FTB Offered “Incompetent” Free Attorneys: Once an Abatement Request/Claim for Refund is denied, the next step is to appeal to the administrative court that handles tax issues, called the Office of Tax Appeals (OTA). FTB has a program called Tax Appeals Assistance Program (TAAP). If your claim is under $30,000, FTB will give you a free student attorney to fight against FTB in the OTA court. The lawyer program is administered by the FTB, the oversight attorney is an FTB employee, and the student attorney is under FTB purview. FTB’s Board of Directors does not see why an FTB employee fighting against their own employer in court is a conflict of interest (item #5). 

Unsurprisingly, my student lawyer made a poor argument that ensured that I would lose in the OTA hearing. When I pushed back against the TAAP program and demanded that we address the accounting fraud as part of my defense strategy, the TAAP oversight attorney fired me as a client. I decided to represent myself. I believe that I did a better job of representing myself than my student attorney would have.

B. FTB Ensures Legal Costs to Dispute Penalties Are More Money Than You Are Trying to Get Back: I was seeking a refund of about $5,000 per year for tax years 2011, 2013 and 2014, for a total of about $15,000. I consulted a couple of lawyers who told me it would cost somewhere between $5,000 and $20,000, and that I would likely lose because OTA almost always sides with FTB. 

After I lost my OTA appeal, I went on to file an appeal in San Diego Superior Court. I chose to represent myself after I talked to three lawyers. One quoted me $100,000, one quoted me $300,000 and one quoted me $800,000 — to get my $15,000 back! All three warned me that I would be unlikely to win a suit against the State of CA in a court where the judge is employed by the State of CA. 

C. FTB Withheld Exculpatory Evidence/Improperly Redacted Documents in Court Documents. FTB Made Allegations Proven to be False. Judges Upheld FTB’s Decision Knowing the Basis Was False: I needed to prove that I had reasonable cause for filing late; that I was not willfully negligent. My argument was that FTB’s own accounting irregularities and onerous demands that I rectify FTB’s mistakes gave us reasonable cause. As I was going through the paperwork that FTB submitted to the OTA court, I caught that FTB’s attorney had redacted some pertinent evidence and omitted other pertinent evidence. He also made numerous misleading, deceptive and false statements that only appeared true because of the redacted and withheld evidence. Basically, to make his case look legitimate, he hid all FTB’s accounting irregularities and FTB’s harassment of me, and tried to make me look like a lazy deadbeat. 

I submitted un-redacted copies of the evidence and copies of canceled checks, tax returns, etc, to document FTB’s accounting irregularities and harassment. I believe that I proved that FTB’s claims were false by exposing FTB’s deception. FTB’s attorney responded with another filing in which he fabricated a false story that we had filed late because we were off traveling on our yacht. Again, I documented that FTB’s claims were completely false. 

During the OTA hearing, the OTA judges required that I take an oath to tell the truth (see 5:02 -5:30). The judges did not require FTB to take an oath to tell the truth. The OTA court said FTB was exempt from oath taking because they were only stating facts, but I had already documented in the evidence that I’d submitted that FTB had essentially falsified the evidence by omitting and redacting pertinent facts. 

In their ruling, the OTA judges omitted the willful negligence issue from the ruling altogether, even though that was the heart of FTB’s argument to justify the imposition of penalties. The OTA also refused to acknowledge any of the proof of accounting irregularities or harassment that I had submitted – including the un-redacted versions of FTB’s own internal paperwork. The court didn’t say one word regarding FTB’s falsifications, they just pretended the falsifications had not happened.   

In my San Diego Superior Court Case, FTB again improperly redacted documents and withheld documents. FTB claimed under penalty of perjury that they’d turned over all documents pertaining to tax years 2011, 2013 and 2014. I caught them withholding two documents from 2011 and one document from 2013. Two of those documents proved that my allegations were true. FTB’s attorney also attempted to deceive the judge by misrepresenting what the laws said and again fabricated a false story.

D. CA Bar Association Refused to Discipline Attorneys: I filed a complaint with the CA Bar Association against the FTB employee who oversaw the TAAP program, Craig Shaltes. The BAR sided with Mr. Shaltes, saying he could make any argument he wanted. I filed a complaint against FTB employee who represented FTB in the OTA case, Eric Yadao. The BAR sided with Mr. Yadao for improperly redacting and withholding judges in order to deceive the judges. The BAR deemed Mr. Yadao did nothing wrong. I also filed two BAR complaints against the Department of Justice attorney, Anna Barsegyan. The BAR quickly shut down the first complaint on the basis that there was a judge on the case, which absolved them of their responsibility for oversight. The BAR initially refused to open the second complaint at all. After I got pushy, the BAR finally opened the second complaint and shit it back down because there was a judge.

E. CA Supreme Court Covered Up the Crimes: I filed an Accusation in the CA Supreme Court against the attorney who lied, and laid out in detail that he lied to cover up his employer’s criminal activities. The CA Supreme Court refused to hear the case, and did not say why.

F. Retaliation and Harassment for Exposing Corruption: In the San Diego Superior Court civil case, Ms. Barsgeyan filed two Motion for Sanctions against me. The first was for $8,000 and was to try to stop me from — and punish me for — gathering evidence to prove FTB’s criminal activities and sending this proof to authorities. In doing this, she attempted to weaponize the Superior Court system to intervene in matters that were outside the scope of the civil case. In her Motion she wrote that the purpose for the sanctions is “to deter and preclude Plaintiff from continuing in her…behavior.”

Court documents are public record. In that Motion for Sanctions, Ms.Barsegyan published my and my husband’s social security numbers. Ms. Barsegyan claimed the data breach was “inadvertent.” However, too many people made too many “mistakes” for the breach to not have been intentional. In the SDSC court ruling, the judge threatened me, implying that something bad would happen to my “nice family” if I continued to make allegations of government corruption. 

In Sara’s case, CPS rigged the justice system in seven ways:

A. Court of Appeals: Sara tried to file an appeal of CPS’s decision in the Court of Appeals. The clerk told them that they had no right to file this case because Sara was not a party in this case against her! 42:49 – 43:02.

B. CPS Ensures Legal Costs to Dispute Penalties Are Too Onerous For An Average Person To Afford: The video didn’t explicitly say this, but it was implied when Sara talked about how she had to submit her own motions and evidence. Courts ignored, denied or struck 61 of the 88 motions that she filed, plus the accompanying evidence: 1:41:03 – 1:41:42.

C. The State of AZ Offered “Incompetent” Free Attorneys: Sara had 12 different court appointed attorneys. All refused to submit her evidence that proved innocence: 1:17:44 – 1:18:42. One attorney advised her to sacrifice one child to save another.

D. CPS Withheld Exculpatory Evidence. CPS Made Allegations Proven to be False. Judges Upheld CPS’s Decision Knowing the Basis Was False: CPS refused to provide medical records to the court that would prove Sara’s innocence in the medical neglect allegations. Instead, CPS changed the claim to be that the child needed to be removed to “prevent potential medical neglect.” The judge upheld the order for removal: 49:48 – 55:46. Later, the removal was upheld based on false testimony with no evidence to substantiate claims: 1:36:25 – 1:38:18. Judge told Sara no evidence was necessary: 1:18:43 – 1:21:19.

E. Court Wouldn’t Let Sara and Her Mother Attend Hearings, violating due process rights: 53:58 – 54:51 and 1:25:45 – 1:27:39.

F. Court Ruled Sara’s Parental Rights Should Be Terminated Because Children are Adoptable: 1:12:59 – 1:17:25 

G. Retaliation and Harassment for Exposing Corruption: Contempt of Court charges were filed to try to stop her from and punish her for talking about case: 1:21:19 – 1:22:49. The court issued a Be On the Lookout Order (BOLO) to keep her from entering the court house. Not only could she not attend her own hearings, she couldn’t attend as an advocate for other families:1:25:45 – 1:13:08.

Playbook Step 4: Other Government Agencies and Legislators Protect the Criminal Schemes

CA: I have reached out to every legislator, elected official and government agency that I can think of for help. All refused to intervene (click on “show more” in the description box under the video for many links to proof). Government Operations (AKA GovOps) is FTB’s oversight agency. GovOps has told me they have no power to force FTB to stop unlawful business practices. The California Department of Justice (Attorney General’s office) not only defended FTB in the SDSC court case, the attorney assigned to my case also knowingly lied to the judge, repeatedly harassed me and retaliated against me. 

AZ: Sara has also reached out to every legislator, elected official and government agency that she can think of for help. All refused to intervene. The Ombudsman’s office was informed that CPS did not follow proper protocol for the removal of Sara’s son. By law, the child was supposed to be returned to his home. Instead of demanding that CPS follow the law, the Ombudsman never got back to Sara: (32:38 – 36:45). As Sara was doing research for her case, she found out that some legislators are stakeholders in the CPS system, so there is a conflict of interest: 32:38 –  33:20 and 1:23:17 to 1:24:4 and 2:00:53 – 2:03:40. The legislators went as far as to wipe some statutes that protect parents off the books. She also has many links in the “description box” under the video with proof of all the agencies and legislators involved in the cover up (click on “show more” to see the links).

Conclusion

It looks like the government agencies have a 4-step playbook that they follow in order to unlawfully enrich themselves: 1. Lay a trap, 2. Deny due process 3. Rig the justice system and 4. Have other government agencies cover it up.

While the specific tactics utilized were not exactly the same in my situation and Sara’s, the tactics were too similar to not be sub-steps of the plays listed in the playbook. Examples of similar tactics utilized against both me and Sara include: false allegations, denial of right to Protest, incompetent free attorneys, onerous legal costs to prevent hiring a private attorney, withholding of exculpatory evidence from judges, questionable rulings from judges that upheld agency’s determination even though allegations had been proven false, retaliation and harassment, and no one in the state government willing to help.

Note: I am not suicidal, I don’t have depression issues, I am a careful driver, I rarely drink alcohol, and I do not use drugs of any kind (not even aspirin). My family lives a wholesome life. If something happens to me or my family that is out of character for us, we were set up by the State of California as revenge for exposing their crimes.