Guilty Victims of Fraud

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Criminals are always on the prowl for victims. Most are innocent, but once in awhile even fraudsters prey on other criminals while they are serving out a prison sentence. (That’s an ironic twist – guilty victims.) An article in the Montgomery Adviser details a $1 million fraudulent tax refund scheme involving incarcerated individuals in an Alabama prison.

The story states that over a two-year period, a brother and sister teamed up to steal identities from multiple sources and filed more than 1,000 false federal and state tax returns in their victims’ names. (Add in an employee at the Alabama Department of Corrections with access to inmate information and a postal employee who provided addresses from his postal route to receive fraudulent tax refund checks and debit cards and you have a perfect recipe for a scam.)

The brother pleaded guilty to one count each of mail fraud and aggravated identity theft and will serve nine years and two months in prison for his crime. The sister was sentenced to 70 months in jail and ordered to pay more than $100,000 in restitution for filing 102 bogus federal and state tax returns. (The article states she was ”caught in the act” by Internal Revenue Service agents. They executed a search warrant and discovered she had access to hundreds of stolen identities.) The postal service employee received a prison sentence of nine years and three months, plus three years supervised release and ordered to pay $82,791 in restitution for his part in the scheme. (Just a reminder that neither snow, nor rain, nor dark of night prevents the government from hunting down and prosecuting fraudsters.)

This case just goes to show that everyone is susceptible to crime and it can happen at any time and in any place. Even to guilty victims in prison.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Area Man Heads to Prison for Million-dollar Tax Fraud,” written by Rick Harmon and published in the Montgomery Adviser on April 30, 2014.

Alabama inmates had their identities stolen in a million-dollar tax fraud that led to an area man being sentenced Tuesday to more than nine years in federal prison.

Between January 2010 and 2012, Harvey James and his sister, Jacqueline Slaton, obtained stolen identities from a variety of sources, including an Alabama Department of Corrections’ employee who had access to inmate information.

 

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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.