WRAL Investigates

Rocky Mount man touts crime-free living despite facing fraud charges

Posted July 8, 2013 6:15 p.m. EDT
Updated August 5, 2013 11:08 a.m. EDT

— Dark sunglasses obscure his eyes. Silver chains hang from his neck. “Hello, I’m the people’s champ,” Larry Hill Jr. says, staring directly into the camera as a woman and two expensive cars pose behind him.   

With those words, the Rocky Mount businessman begins his 30-second plea to local youth. “I want all my young people to think before you act. Trouble is too easy to get into, and once you get into trouble, you’ll be all by yourself,” he says in the YouTube clip posted last November.

In another clip, Hill hands out cash to Rocky Mount children as part of his “Crime Free Summer Good Deeds Contest” as the words “Stop the violence” flash on the screen. Despite his attempts to dissuade children from trouble, federal authorities say it’s a message Hill hasn't lived by.

From February 2010 to October 2012, Hill’s tax business filed hundreds of “false, fictitious and fraudulent refunds” for customers, claiming millions in refunds, according to the U.S. Department of Justice. Federal court records filed in April show authorities charged Hill with fraud and conspiracy in connection with his business, Hill’s Tax Service.

Beginning in 2010, investigators said, the Rocky Mount business filed more than 300 tax returns for clients, claiming in excess of $1.5 million in refunds. Within a few years, the business expanded to four other locations – in Wilson, Scotland Neck, Hollister and Farmville – and so did the fraud, according to the criminal complaint.

From $1.5 million in refunds in 2010, to $5.4 million in 2011, to $7.5 million in 2012, prosecutors say most of the returns, including Hill’s own, were fraudulent. Prosecutors allege Hill’s tax preparers manipulated the Earned Income Tax Credit for low-income filers by falsely reporting interest income, withholdings and dependents and that Hill profited from each bogus return.

According to the criminal complaint, Hill collected an average of $1,000 for himself from each fraudulent refund check. He reported an income of $8,750 on his taxes for 2010. Authorities say it was more than that, but they did not provide an exact amount.

A trial date has not been set for Hill, who served time for a 2007 fraud conviction for an insurance scam related to staged automobile accidents. He still owes more than $70,000 in restitution in that case.

All five of his tax preparation offices have shut down.

Hill’s federal fraud charges are in stark contrast to the man who markets himself as a philanthropist and mentor to troubled youth.

The WRAL Investigates team caught up with Hill at a used car sales business, where he is known as “the head honcho.” He declined to comment or refer to an attorney for comment, but he later emailed WRAL on June 28 to say that he shares "some of the blame" for his legal troubles.

"He without sin cast the first stone," Hill wrote, adding that “life would be boring” if everyone was like Bill Cosby, apparently referring to the actor’s good-guy image

Besides giving away cash to children, Hill also gave away shoes and made donations to youth programs, according to his YouTube videos, which hail him as a philanthropist who believes that “blessings should be shared with others.”

“Yep, that’s him,” said friend Lonnie James Davis, as he watched one of Hill’s videos recently. “(He) was sending a positive message.”

Davis says he appreciates what Hill has done for the community, especially the youth, and says he doesn’t find his friend’s legal troubles ironic.

“That’s real. He’s going to stay that way. He’s real to the community,” Davis said. “The reputation he has in Rocky Mount is good. He's the people's champ, like he said. The reason he calls himself ‘the people's champ’ is because he tries to help everyone.”

While friends such as Davis defend Hill's community service, others in the community say they see hypocrisy.

“He's done some great things in the community … (But) when you've got a heart that's not really matching your surface, then it's going to cause a problem,” said Rocky Mount resident Rick Lawrence. “I hope that he can understand that you've got to be reputable if you're going to represent the children in this town because they need a lot of guidance, and if you're reputation is tarnished, it's not going to look good at all.”