Two Canadians are in hot water in the United States over accusations they deposited tax refund cheques they weren't entitled to -- worth hundreds of thousands of dollars each -- into U.S. bank accounts.

Special Agent Michael C. Ball, of the Criminal Investigation Division of the IRS, laid out the allegations in a pair of criminal complaints recently filed in a U.S. District Court in Seattle.

According to the criminal complaints, Donald J. Mason of Fort Saskatchewan, Alta., and John W. Chung, of Kelowna, B.C., each opened Bank of America accounts and deposited "a fraudulently obtained U.S. Treasury cheque" during the month of October.

The IRS says Mason allegedly deposited a tax refund cheque with a value of US$359,926.80, and claims Chung allegedly deposited a tax refund cheque worth US$369,534.60.

The IRS alleges that the men received their tax refund cheques as a result of fraudulent nonresident alien income tax returns that were recently filed for the 2006 year.

Both men claimed that the money had been withheld at source. But the IRS says that no tax was withheld from either man.

The charges against Mason and Chung have not been proven in court.

Mason and Chung were arrested separately on Oct. 29, when the pair tried to withdraw the money at their respective banks.

Chung was arrested first, at a Bank of America branch in Seattle, while Mason was arrested at another branch about 150 kilometres north in Bellingham, Wash.

Authorities claim they later searched a hotel room where Mason had been staying and allegedly found documents "that described a scheme on how to defraud the government."

Investigators claim that Mason wired US$2,000 to a Canadian bank account prior to his arrest and that Chung had taken out "tens of thousands of dollars."

In a brief telephone interview, Special Agent Daniel Wardlaw, an IRS public information officer, said "cases like these are not uncommon."

Wardlaw subsequently passed statistics on to CTV.ca showing that the IRS has conducted more than 400 "questionable refund investigations" during the current fiscal year.

Both Mason and Chung have been charged with one count of theft of public money. They remain in detention in the U.S.

With files from The Associated Press