1,500 soldiers, family members among tax fraud victims
By Karen Jowers, Staff writer 2:21 p.m. EDT August 11, 2015
Ten people — including an employee of the military hospital at Fort Benning who stole personal data of soldiers and family members — were sentenced to serve a combined 50 years in prison for their role in an extensive stolen identity tax refund fraud scheme in Georgia and Alabama.
The tax fraud ring filed more than 9,000 false individual federal income tax returns that claimed more than $24 million in tax refunds. In addition to the military hospital, the tax fraud ring stole personal information of victims from several Alabama state agencies, a Georgia call center and a Georgia company. The IRS paid out nearly $10 million in refunds on those fraudulent claims, according to Justice Department officials.
Of the victims, about 1,500 were soldiers and family members who had portions of their identities stolen, according to Chris Grey, spokesman for the Army Criminal Investigation Command. Some of those soldiers were deployed to Afghanistan during the time of the fraud, which occurred between January 2011 and December 2013.
Tax refunds that were legitimately due to some soldiers were denied when their personal data was stolen and used to get a fraudulent refund. Asked if those soldiers would receive their refunds, an IRS official said that by law, the IRS cannot discuss the situation of specific taxpayers. But any taxpayer who finds himself or herself the victim of identity theft should file the required paperwork, and the IRS will work with them to make them whole, the official said.
Eight of the defendants were sentenced Friday, after they had pleaded guilty earlier this year or last year to various charges, and were among 11 people who participated in the tax fraud ring.
Tracy Mitchell, of Phenix City, Alabama, who worked at Martin Army Community Hospital at Fort Benning, was sentenced to 13 years and three months in prison, three years of supervised release, and ordered to pay $329,242 — the amount authorities seized from her residence. She and Keisha Lanier, of Seale, Alabama, led the identity theft ring, Justice officials said in a statement. Lanier is scheduled to be sentenced Aug. 24.
The sentences “show our unwavering commitment to aggressively pursue cases of cyber crime and protect the men and women serving our nation,” said Daniel Andrews, director of the Army Criminal Investigation Command’s Computer Crime Investigative Unit, in a statement from the Justice Department. “These defendants stole personal identities for monetary gain, and their sentences should resonate with would-be criminals that we can, and we will, hold them accountable for their crimes.”
The defendants obtained several IRS electronic filing numbers in the names of sham tax businesses, officials said. They then applied for bank products from various financial institutions in the names of those sham businesses, and received blank checks from the financial institutions. The IRS issued refunds in prepaid debit cards or checks. In cases where the IRS electronically deposited the refunds, the defendants used the checks they’d received to get access to the money.
When the financial institutions stopped allowing the defendants to use the checks, Mitchell and her family members recruited U.S. Postal Service employees in their scheme, according to Justice officials. The employees specified addresses along their postal routes to have the IRS checks mailed, then intercepted those checks and turned them over to the defendants for a fee. The defendants also set up a money-laundering operation, recruiting a Walmart employee in Columbus to cash checks that were fraudulently issued in the names of other individuals. To conceal the scheme from Walmart, the defendants recruited people to take the refund checks to the Walmart employee to cash.
The 10 defendants who have been sentenced so far have been ordered to pay a total of nearly $7 million.
At the sentencing of the eight defendants Friday, a statement was provided from the mother of a 19-year-old soldier who had his identity stolen while he was in training at Fort Benning.
She was notified by an IRS agent that her son’s identity had been stolen.
“As I tried my best to keep composed and handle all of the gruesome mounds of paperwork to get this straightened out with the IRS [my son] was then denied his tax refund,” the mother’s statement said. “This created a financial hardship on [him]. We were too afraid to tell [him] while he was deployed because we did not want to worry him and we wanted him to focus only on getting home alive and not have to worry about such an atrocious act by someone who did not even know [him.]”
The IRS first identified suspicious activity, and once Army personnel were identified, IRS officials contacted the Army Criminal Investigation Command, Grey said. “When that occurred, special agents from the CID’s Computer Crime Investigative Unit began a joint investigation with the IRS.”
U.S. Attorney George L. Beck Jr. of the Middle District of Alabama, said “no sentence is too strong for those who prey on our fighting men and women.
“War is hell on the home front, too, and the family left behind holding things together must be strongly protected.”
http://www.militarytimes.com/story/military/crime/2015/08/11/1500-soldiers-family-members-among-tax-fraud-victims/31460861/
