Exchanging Visas for Jail Time

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Have you had the opportunity to travel internationally? Whether you’re jet-setting to shady palm trees in the Caribbean, or on a student exchange program, you’ll need to be well-versed on the appropriate identification documents necessary for travel. Let’s look at the reverse; for example, students coming to America (let’s say from Romania) would need to have a student visa. According to a Sun Times Media Wire article, student visas equaled opportunity for one fraudster.

Traveling to a new country as an exchange student is exciting. While the new experiences are great, it’s even better to return home with a new perspective on life and increased knowledge of the world. (And, knowing you will be victim to tax refund fraud.)<i? Investigators determined that the defendant is a leader of an international tax refund fraud conspiracy, which has cost the federal government approximately $1.6 million. The scam was comprised of 23 individuals, targeting the Chicago area, and was responsible for nearly 470 false tax refund requests between 2007 and 2009. You might be asking yourself? ”How does an outsider understand the workings of the U.S. tax system well enough to defraud the government and make money to send back to his home country?’? Easy – he just has to understand one simple thing? where to access personal identification information. (So, where did they find that info? In a university, an international education organization or an organization that arranges for student travel?) The fraudster targeted individuals who had received temporary student visas and no longer resided in the U.S. After obtaining their Social Security numbers and other personal identification information, he submitted false federal tax returns. The government relied on the self-reported information and unknowingly paid the fraudster, who sent a portion of the profit to his home country. (He knew these individuals were easy targets. They would never have an opportunity to submit tax refunds again.) The judge ordered the fraudster to spend 85 months in prison, as well as reimburse the federal government the $1.64 million. Additionally, his deportation is pending, following completion of his prison sentence. (Right; like we will ever see that money again!)

What do students actually learn when they study abroad? In this case, it looks like there was a detailed lesson on how to take advantage of a tax system. I’d be happy to proctor the lesson in what happens when you get caught for the fraud scam.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Romanian Living in Skokie Gets 7 Years for $1.6M Tax Fraud,” published by the Skokie Review on April 15, 2012.

A north suburban man convicted of being the U.S. leader of an international conspiracy that received about $1.6 million in fraudulent tax returns will spend more than 7 years in federal prison.

Ovidiu Isac, 31, a Romanian native living in Skokie, directed 23 co-conspirators in the Chicago area who used their bank accounts to receive the phony refunds and divert the money to Romania after taking a cut, a statement from the U.S. Attorney’s office said.

 

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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.