A Trail of Evidence

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26835495 - side view of hacker using multiple computers to steal data at table

Criminals usually assume that they will never get caught and be prosecuted for their dastardly deeds. (In fact, they probably don’t think much about the consequences for their illegal actions until after the fact.) An article published by The Morning Call tells us about a Pennsylvania man who thought he could get away with filing tax returns in the names of unsuspecting victims and the nearly $3 million he collected from the U.S. Treasury.

The 26-year-old defendant in this article committed his crime by filing more than 600 fraudulent tax returns in the names of Puerto Rican residents who had no idea they were victims of the tax return fraud scheme. (Puerto Rico is an easy target for tax fraud because residents are not required to file a tax return if they work exclusively in the U.S. Territory. Criminals assume that if residents don’t file a return in the first place, then duplicate returns are not an issue.)

Authorities became suspicious when police were notified that the fraudster’s apartment had been burglarized. After obtaining a search warrant, law enforcement seized the man’s computer and an external drive. (It is not known why investigators thought they would find evidence of a crime on these devices, but their hunch was a good one.) The search discovered a folder with nearly 100 tax returns, a spreadsheet of employer identification numbers, tax form software, a program to hide a computer’s identity on the Internet and a term paper written by the fraudster. (Perhaps the term paper was about how to make $3 million without working hard.)

 

Approximately a year later, agents searched the home of the criminal’s parents where he was currently living and discovered more evidence including handwritten lists of names, Social Security numbers and refund amounts. They also discovered medical records with personal identification information, more tax software, and hundreds of tax returns. Investigators were also able to tie the Internet address from which the tax returns were filed to his parent’s home.

The man pleaded guilty to 23 counts of making false claims against the government. He faces a maximum sentence of 115 years in prison and a fine of up to $5.75 million. The story states that the criminal did take responsibility for his actions. (Maybe he will receive a reduced sentence.)

This young man discovered how to make a lot of money in a very short period of time – less than two years to be exact. But, he wasn’t exactly good at hiding the convicting evidence. He has no one to blame but himself. He left a trail of evidence and led the police directly to his door when he called police to report a burglary. It will be up to the judge to decide what this guy’s fate is, but he’s probably going to have plenty of time under the observation of the penal system to mull over the impact of his selfish deeds.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Allentown Man Pleads Guilty in $3M Tax Refund Fraud,” written by Peter Hall and published by The Morning Call on August 21, 2014.

Andy Rodriguez of Allentown made nearly $3 million in less than two years by filing tax returns for other people.

The problem, federal authorities say, is those people didn’t know about it and the tax returns were fraudulent.

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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.