The Middleman

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income, part of tax return form, close up shot

The value of United States territories, like Puerto Rico, can be argued by proponents and opponents with no end agreement. A fraudster will see value in keeping Puerto Rico as a territory as long as there are social security numbers to be had.

Residents of Puerto Rico all granted a U.S. social security number to be used with filing federal income tax returns, required if earning money from anywhere else in the globe, including the United States, and/or if they work for any US government agency in Puerto Rico.

This amounts to just less than 10 percent of the overall population every year. With the current population at just over 2.7 million, there are a lot of social security numbers that have not needed to file which means no record in the Internal Revenue Service database. This makes for a value-add opportunity for fraudsters like Jorge Gutierrez. On July 28th, 2022, Jorge Gutierrez, was sentenced for his part in a ring that stole the identities of Puerto Rico residents and filed phony income tax returns.

Gutierrez was no accountant, but his role was no less important. Gutierrez was the Middleman.  All the fraudulent income tax returns used return addresses from Pennsauken, NH. Local U.S. Postal Service employees were paid to divert the government checks before they reached the addresses. There were also paid “check couriers” who cashed the tax refund checks at check-cashing businesses in and around Camden using fraudulent identifications matching the names on the tax refund checks. Gutierrez collected the checks from the Postal employee and hand delivered them to the Check Courier.

It may have seemed like an easy job for Gutierrez, but it won’t be easy for him for a while. In addition to a prison term of three years, a full restitution was ordered of $565,091 for Gutierrez’s profit in the scheme.

A shout out to the special agents of the IRS-Criminal Investigation their work in this whole multi-million-dollar scheme.

Today’s “Fraud of the Day” is based on an article, “Merchantville Man Sentenced to Three Years in Jail for Fraudulently Obtaining Refund Checks from U.S. Treasury,” published by RLS media on July 29, 2022.

A Merchantville man was sentenced Thursday to 36  months in prison for his role in a scheme to obtain money through fraudulently obtained refund checks issued by the U.S. Treasury, U.S. Attorney Philip R. Sellinger announced.

Federal officials said Jorge Gutierrez, 43, of Merchantville previously pleaded guilty before U.S. District Judge Robert B. Kugler to an indictment charging him with conspiracy to defraud the United States. U.S. Attorney Philip Sellinger’s office says in March 2018, Gutierrez, Alberto Sanchez, Awilda Henriquez, and Roque Bisono were indicted by a federal grand jury. Federal officials say the group recruited U.S. Postal Service mail carriers as part of the scheme. Those carriers were paid for every U.S Treasury check that was stolen.

 

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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.