Woman Pleads Guilty to Perjury in Tax Probe

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By Aaron Hepker

Story Created: Feb 22, 2012 at 5:03 PM CDT

Story Updated: Feb 22, 2012 at 5:03 PM CDT

CEDAR RAPIDS, Iowa (AP) — A former Waterloo woman has pleaded guilty to perjury for lying to a federal grand jury that investigated her friend for tax fraud.

Denise Brown pleaded guilty Wednesday in federal court in Cedar Rapids. Prosecutors dropped a second count charging the 25-year-old with lying to an investigator.

The case stems from the investigation of former Waterloo tax preparer Latanya Bailey, who was sentenced to 30 months in prison in 2010 for filing false information on tax returns to increase the size of refunds.

Brown lied to support Bailey's claim that Bailey owned an interior decorating business, which gave Bailey a larger tax credit. Brown told grand jurors she paid Bailey for furnishing and cleaning her apartment, which wasn't true.

Brown was arrested last month in Texas, where she had moved.

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