Rocky Mount Tax Preparer’s $3.9M Fraud Empire Crumbles, She Confesses Guilt

RALEIGH, N.C. - Chowan Watson, 55, of Rocky Mount, pleaded guilty in federal court to one count of aiding and assisting in the preparation of a false tax return resulting a tax loss of approximately $3,900,000. Watson faces a maximum penalty of 36 months in federal prison when sentenced later this year. She has agreed to pay restitution to the IRS.

"Watson and Dickens didn't just bend the rules-they broke the door wide open," said U.S. Attorney Ellis Boyle. "For years, they engineered a scheme that faked withholdings, pumped up refunds, and drained the U.S. Treasury of nearly four million dollars. They preyed on the trust of hardworking Eastern North Carolinian taxpayers and twisted a legitimate tax preparation service into a personal profit machine. This case sends a clear message to all fraudsters: if you cheat the system and exploit your clients, we will expose your scheme, pursue you, and prosecute you. Cheaters. Never. Win."

Watson and Angela Dickens, who previously pleaded guilty operated Empire Tax Service, later renamed K&J Tax Service, in Rocky Mount. From 2017 to 2023, Watson and Dickens fraudulently filed hundreds of tax returns by inflating "Other 1099 Withholding" amounts. Their scheme inflated taxpayer refunds and allowed them to take excessive fees from those refunds. Total tax losses are approximately $3.9 million.

"Those who attempt to undermine the integrity of the American tax system should understand IRS Criminal Investigation follows the money to uncover fraudulent schemes," said Special Agent in Charge Donald "Trey" Eakins, IRS Criminal Investigation's Charlotte Field Office." IRS-CI, partnered with the U.S. Attorney's Office, will continue to relentlessly pursue anyone who seeks to defraud the tax system and ensure offenders are brought to justice."

On April 7, 2026, the Department of Justice announced the creation of the National Fraud Enforcement Division ("Fraud Division"). The Fraud Division is investigating and prosecuting those who commit fraud against the American people. The Department's work to combat fraud supports President Trump's Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.

Ellis Boyle, U.S. Attorney for the Eastern District of North Carolina made the announcement after Chief U.S. District Judge Richard E. Myers II accepted the plea. IRS Criminal Investigation is investigating the case.

A copy of this press release is located on our website. Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North CarolinaLinks to other government and non-government sites will typically appear with the "external link" icon to indicate that you are leaving the Department of Justice website when you click the link. or on PACERLinks to other government and non-government sites will typically appear with the "external link" icon to indicate that you are leaving the Department of Justice website when you click the link. by searching for Case No. 5:26-CR-125-M.