Ignorance is Not Bliss

20067797 - w2 tax form and social security cards

You’ve probably heard the saying, ”Ignorance is bliss.” This suggests that it’s more convenient or comfortable to ignore the fact that something unscrupulous is going on. A press release published by the Department of Justice describes one woman’s feigned attempt at ignorance while testifying at her own defense trial. She did not want to admit to her part in a tax fraud scheme. (Lesson learned? Co-conspirators will usually rat you out if it means the judge will go easier on them.)

The story states that the 32-year-old was in the business of providing stolen identities to a co-conspirator who used the information to file false tax returns. The mother of three obtained the identities from a friend who happened to work as a bail bondsman. He had access to the names, dates of birth and Social Security numbers of individuals who had been detained at the local jail. (Talk about being unlucky twice.) The woman who used the stolen information to file fraudulent tax returns directed the bogus refunds to be deposited onto prepaid debit cards which were then mailed to addresses controlled by both women.

While testifying at her own trial, the fraudster who sold the stolen identities stated that she had indeed obtained information from the bail bondsman, but she did not know what that information contained. (Yeah, right.) She also testified that she was storing something for the woman who submitted the fraudulent tax returns, but she didn’t know exactly what it was.

Unfortunately, for the fraudster, the evidence presented against her in court was overwhelmingly convicting. It turns out that she stated in calls with the tax fraudster that she had stolen identities stashed in a storage unit. Further research revealed that she also attempted to sell the stolen identities from a Florida hotel located across the street from a police station. (Now that’s brilliant!) Her efforts were foiled when the motel mistakenly checked someone else into her room while she was not there. Federal agents were able to seize many stolen identities and prepaid debit cards from her storage unit. Altogether, the tax refund fraudster filed tax returns claiming more than $300,000 in bogus returns using the stolen identities. (Fortunately, the Internal Revenue Service was able to stop many of the fraudulent returns.)

The woman was found guilty by a jury of conspiring to defraud the government through the filing of false tax returns. She faces a maximum sentence of 20 years in prison for three counts of wire fraud and a two-year mandatory prison sentence for three counts of aggravated theft. The two co-conspirators had previously pleaded guilty to their part in the tax fraud scheme. (Their statements most likely helped to convict the woman who sold the identities.)

This case proves that ignorance is not always bliss, especially when you have knowledge about illegal activities. Who knows…maybe the woman would have been looking at a reduced sentence if only she had told the truth in the first place. One thing is for sure – there is nothing blissful about being in prison.

Source: Today’s ”Fraud of the Day” is based on a press release titled, ”Alabama Woman Convicted of Stolen Identity Refund Fraud,” published by the Department of Justice on July 16, 2014.

A jury found a Dothan, Alabama, woman guilty of conspiring to defraud the government through the filing of false tax returns, Deputy Assistant Attorney General Ronald A. Cimino of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama announced today.

Nina Macena, 32, was also found guilty of three counts of wire fraud and three counts of aggravated identity theft.

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Larry Benson, Senior Director of Strategic Alliances, LexisNexis Risk Solutions - Government

Larry Benson is responsible for developing strategic partnerships and solutions for the government vertical. His expertise focuses on how government programs are defrauded by criminal groups, and the approaches necessary to prevent them from succeeding.

Mr. Benson has 30 years of experience in sales and business development. Before joining LexisNexis® Risk Solutions, he spent 12 years founding and managing two software technology startups. During the 1990s he spent 10 years as a Regional Director helping to grow a New England-based technology company from 300 employees to 7,000. He started his career with Martin Marietta Aerospace working on laser guided weapons and day/night vision systems.

A sought-after speaker and accomplished writer, Mr. Benson is the principal author of “Fraud of the Day,” a website dedicated to educating government officials about how criminals are defrauding government programs. He has co-authored WTF? Where’s the Fraud? How to Unmask and Stop Identity Fraud’s Drain on Our Government, and Data Personified, How Fraud is Changing the Meaning of Identity.

Benson holds a Bachelor of Science in Physics from Albright College, and earned two graduate degrees – a Master of Business Administration from Florida Institute of Technology, and a Master of Science in Engineering from Lehigh University.