Anticipation

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It’s hard to wait for something that we have long anticipated. Whether it is a child’s dream to receive a new bike for his birthday or the long-awaited arrival of a soldier returning from a foreign conflict, we have great expectations attached to getting what we want. Criminals also have great hopes and dreams for getting something they want from their victims. In a press release, the Department of Justice details the case of two fraudsters who obtained personal identification information and filed false tax returns in anticipation of receiving refunds for which they were not entitled.

The press release states that a woman from Anchorage and a man from Los Angeles conspired with two others to use names, dates of birth and Social Security numbers to falsely prepare federal W-2 forms, which contained fabricated wage and withholding amounts. The co-conspirators used several tax return preparation services in Alaska and California to electronically submit the documents to the federal government.

The criminals were out to get as much money as possible, so they increased the refund amounts on the fake returns by claiming dependent children. (You can count on criminals to be greedy.) Refund amounts totaled between $1,400 and $8,600 each. The fraudsters also applied for refund anticipation loans, which were loaded on stored value cards, allowing instant access to the money even if the government rejected the claim later.

As you might guess, the criminals took the money and ran right to a car dealership, where a Mercedes was purchased. (If I’ve said it once, I’ve said it a thousand times: fraudsters love their fancy cars.) The illegally acquired tax returns were also used to purchase a variety of personal items.

Both the man and the woman entered guilty pleas for conspiracy to commit wire fraud in connection with filing false income tax returns as well as aggravated identity theft. One of the co-conspirators is a fugitive and the other one has an impending court date. The defendants each face up to 20 years in prison for wire fraud and a mandatory two-year consecutive sentence for the identity theft. The maximum fine is $250,000.

The co-defendants were fixated on the rewards from obtaining illegal tax refunds, not on the punishment if caught for their deceptive deeds. There is no doubt that they will have to shift their expectations from anticipating a comfortable lifestyle to the reality that they will be spending a long time in an uncomfortable prison.

Source: Today’s ”Fraud of the Day” is based on press released titled, ”Two Admit to Conspiracy for Identity Theft and Wire Fraud in Connection with the Filing of False Income Tax Returns,” published by the Department of Justice on December 16, 2013.

ANCHORAGE – U.S. Attorney Karen L. Loeffler announced today that Lucille Stansberry, 40, of Anchorage, Alaska, and Joe Murl Douglas, Jr., 54, of Los Angeles, California, entered guilty pleas in federal court on Friday, December 13, 2013, before U.S. District Court Judge Timothy M. Burgess, to conspiracy to commit wire fraud in connection with filing false income tax returns, and aggravated identity theft.

Stansberry and Douglas admitted conspiring with two others to obtain identifying information, such as names, dates of birth, and Social Security numbers, which were then used to prepare false IRS Forms W-2 that contained fabricated wage and withholding amounts. The identifying information and falsified documents were taken to tax return preparation services in Anchorage, Eagle River, and Palmer, Alaska, as well as in Los Angeles and Orange Counties, California, to have tax returns prepared and electronically submitted to the IRS.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.