It Can Happen Anywhere

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Identities used in Stolen Identity Refund Fraud (SIRF) crimes can be stolen from anywhere – hospitals, nursing homes, or even public death lists. An enterprising woman from Antioch, Tennessee committed SIRF and aggravated identity theft by using the personal information of incarcerated individuals under the care of the Alabama Department of Corrections. Her illegal actions caused a tax loss of $700,933.20 to the Internal Revenue Service (IRS).

It is not known how the woman obtained the identity information for the eight prisoners she used to file bogus tax returns over a two-year period. According to the 16-count indictment, the illegal returns she allegedly prepared using Turbo Tax software in her apartment, were similar in amounts – six claiming returns of $1,464 and two claiming $1,443. The jobs listed on the tax returns were similar as well. (Perhaps she was lazy and just used the same profile for each identity. That’s most likely what raised the red flag for the IRS.)

Additional research shows that her scam came to an end when her Antioch apartment was raided. Agents confiscated computers, paperwork including inmates’ names, birth dates, and Social Security numbers and her personal bank records. She directed the tax refunds into the bank accounts belonging to her minor son and her adult son, who is mentally challenged. (Then she wrote checks to herself out of these accounts.)

The Tennessee woman was convicted on eight counts of wire fraud and eight counts of aggravated identity theft at a jury trial and was sentenced to six years in prison. (She is very lucky that she didn’t get the maximum sentence, which was 20 years for each count.) The fraudster must also serve three years of supervised release with restitution to be determined at a later date. (Let’s hope she didn’t spend all of the money she stole, otherwise, the IRS may never get its tax revenue back.)

During the IRS 2013 filing season alone, more than five million tax returns were filed using stolen identities. These bogus returns claimed approximately $30 billion in refunds. Fortunately, the IRS stopped or recovered more than $24 billion of that amount. By 2015, the IRS prevented $8 billion in identity theft returns from being paid.

While the IRS is getting better in detecting fraudulent returns, a large part of the responsibility lies with the taxpayer to do everything they can to prevent their identities from being stolen. To see how the IRS, the states and the tax industry are protecting your federal and state tax accounts, click here to discover the many new safeguards that are being put in place to help fight against SIRF.

Today’s “Fraud of the Day” is based on a Department of Justice press release entitled, “Tennessee Woman Sentenced to Six Years in Prison for Stolen ID Refund Fraud,” released on January 29, 2018.

An Antioch, Tennessee, woman was sentenced to six years in prison for wire fraud and aggravated identity theft, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Donald Q. Cochran for the Middle District of Tennessee.

Monique Ellis was convicted following a jury trial in October 2017 of wire fraud and aggravated identity theft. According to documents filed with the court and evidence presented at trial, in January and February 2012, Monique Ellis used stolen IDs, including those of prisoners held by the Alabama Department of Corrections, to file tax returns with the Internal Revenue Service (IRS) seeking fraudulent refunds.  Ellis directed the fraudulently obtained refunds to bank accounts that she controlled, causing a tax loss of $700,933.20.

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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.