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State of California Franchise Tax Board

Riverside County Woman Sentenced to Nine Years State Prison for State Tax Evasion and Grand Theft

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For Immediate Release


Sacramento – An Aguanga woman was sentenced today to nine years in state prison for four felony counts including state income tax evasion, forgery, and grand theft with white collar crime enhancement, according to the Franchise Tax Board (FTB).

Elizabeth Ann Masters, 45, pleaded guilty in March 2013. From 2003 through 2011, Masters was employed as the company controller of a clothing manufacturing company where she was responsible for payroll distribution. Masters embezzled nearly $5.7 million from her employer during these same years. She forged more than 700 company payroll checks and deposited them into her personal bank accounts. The majority of the funds were used to buy and maintain a large horse ranch in Southwest Riverside County.

Thompson filed false personal income tax returns for 2006 through 2010, and failed to report more than $3.4 million in embezzled income. All income is taxable including income from illegal sources.

Masters was also ordered to pay restitution of more than $5.7 million to her former employer and more than $650,000 to the state representing the unpaid tax, penalties, interest, and the cost of the investigation.

According to San Diego County District Attorney’s office, the size of Master’s embezzlement makes the case the second largest in recent North County history. San Diego County Superior Court Judge David L. Berry handed down the sentence in North County Regional Center’s Department 6.

The case was prosecuted by San Diego County Deputy District Attorney Anna Winn. It was a joint investigation with the San Diego County Sheriff’s Department and FTB’s Criminal Investigation Bureau.

FTB’s criminal investigation program identifies and investigates cases of tax evasion and tax fraud to encourage compliance with California income tax laws and maintain the public trust.

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