FOX6 Investigators: ID theft kept secret by IRS

 ID Theft  No Responses »
Apr 292013
 

Fox6 puts a human face on the problems of identity theft, with a focus on how the IRS has not notified people whose identity information (Social Security number) was misused. Frustratingly, the IRS was saying it couldn’t disclose such information because of the privacy rights of the identity thieves. A law passed to remedy some of the problem has been only partially helpful as the IRS still has not done a good job of alerting people when their SSN is being misused.

Read one couple’s story on Fox6.

Alabama Man Indicted for Multi-Million Dollar Stolen Identity Refund Fraud Scheme Using Prisoner Identities

 Breach Incidents, Government Sector, ID Theft, Insider, U.S.  No Responses »
Apr 272013
 

A federal grand jury in Montgomery, Ala., returned an indictment charging Harvey James for using stolen identities to file false tax returns, the Justice Department the Internal Revenue Service (IRS) announced yesterday. The 34-count indictment charges James with mail fraud and aggravated identity theft.

According to the indictment, Harvey James obtained stolen identities from individuals who had access to inmate information from the Alabama Department of Corrections. James and others used those inmate names to file false federal and state tax refunds. James directed some of the false refunds to be sent to either prepaid debit cards or issued via check. He directed some of the prepaid debit cards and state tax refund checks to be mailed to various addresses on a U.S. Postal Service mail carrier’s route which was located in Montgomery, Ala. Between 2010 and 2012, James and others are alleged to have filed over 2,000 federal and state income tax returns that claimed over $2.5 million in fraudulent tax refunds.

An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt.

SOURCE: U.S. Department of Justice

Weather Shield employees find out they are identity theft victims once again

 Breach Incidents, Commentaries and Analyses, ID Theft  Comments Off
Apr 162013
 

Back in April 2011, I noted that employees of Schield Family Brands were being alerted to a possible breach after there were 87 reported cases of ID theft/fraud affecting employees.  Schield Family Brands includes four central Wisconsin window and door manufacturers: Weather Shield, Peachtree, Vetter and Crestline.  At the time, the Secret Service took over the investigation as Schield was unable to confirm that they were the source of any breach.

In February of 2012, the number of affected employees rose, as dozens discovered that their information had been used for tax refund fraud.  It was not clear at that time whether these individuals might have had their data compromised the previous April, or if any of these were new employees whose data might have been newly compromised.

Now it’s happening again, it seems.

Mike Joyce reports that many Weather Shield employees filed their tax returns, only to learn that someone else had already claimed tax refunds in their names.

The Rusk County Sheriff’s Department says 55 Weather Shield employees countywide have had their identities stolen and some of them are repeats from 2012.

“We are getting more and more coming in because I think people wait until the last minute before they file and they are finding out they are becoming victims and we are getting more in the last couple weeks than we did earlier in the year,” explains Rusk County Sheriff David Kaminski.

So how could the same person be victimized two years in a row, especially after steps were taken to prevent it from happening again?  Weather Shield says it doesn’t know.  The company says there’s no evidence the identity theft happened at Weather Shield.

Read more on WQOW.

So here we are, two years later, and still no one knows how these employees wound up as victims of ID theft, but the misuse of their information is ongoing.  Is the Secret Service still involved in this case? And after some of these people were tax refund fraud victims in 2011, why didn’t the IRS flag their returns for 2012 to prevent the repeated fraud?

Clearly, this is a difficult case, but it seems like the IRS has failed to adequately protect known victims.

Miami woman convicted for role in tax refund fraud scheme

 Breach Incidents, Government Sector, ID Theft  Comments Off
Apr 162013
 

Natoya Mashea Handy, 30, of Miami,  was convicted on April 12 for her participation in a tax refund scheme using stolen identities. She was one of the 40 people charged in October 2012, as part of law enforcement’s crackdown on tax refund fraud schemes.

According to testimony and evidence presented at trial, on or about April 5, 2012, the defendant was found with at least fifteen (15) social security numbers, names, and dates of birth belonging to persons who were formerly or presently incarcerated by the state of Florida. The trial testimony and evidence further showed that fraudulent tax returns were filed for tax year 2011 for seventeen (17) of the individuals whose social security numbers the defendant possessed. Each of these fraudulent tax returns fraudulently claimed entitlement to a refund, amounting to thousands of dollars in fraud.

The press release from the U.S. Attorney’s Office did not indicate which state database(s) may have been breached to support the fraudulent activity.

Source: U.S. Attorney’s Office, Southern District of Florida.

Two Miami Men Convicted In Identity Theft Tax Refund Fraud Scheme Involving Over 1,000 Victims

 Breach Incidents, Education Sector, ID Theft, Miscellaneous, U.S.  Comments Off
Apr 162013
 

Earnest Baldwin, 36 of Miami, and Earl Baldwin, 42 of Miami were convicted on April 10 for their participation in a tax refund scheme using stolen identities. They had been charged in October 2012.

According to testimony and evidence presented at trial, the defendants were involved in an identity theft tax fraud scheme that operated from July 2011 through June 2012. During the course of their fraud scheme, approximately $1.7 million in fraudulent refund claims were submitted to the IRS for payment. Nearly all of these claims requested payment of the refunds onto pre-paid debit cards and some of these claims were filed from Earl Baldwin’s residence.

The trial testimony and evidence further showed that Earnest Baldwin was found with over 1,000 individual names, dates of birth, and Social Security numbers and approximately 40 pre-paid debit cards in other people’s names. Some of these papers seized included high school report cards with identity information and data from an organization for disabled persons containing identity information. Neither the school nor the organization were named in the press release from the U.S. Attorney’s Office.

Two additional co-conspirators, Lineten Belizaire, 22, and Marckell Steward, 21, both of Miami, previously pled guilty in this matter. Belizaire pled guilty to access device fraud and aggravated identity theft on March 18, 2013. Steward pled guilty to conspiracy to commit access device fraud and aggravated identity theft on January 31, 2013.

Source: U.S. Attorney’s Office, Southern District of Florida.

Husband and wife sentenced in tax refund fraud scheme in Florida

 Breach Incidents, Business Sector, ID Theft, Insider, U.S.  Comments Off
Apr 132013
 

Douglas Michael Young (a/k/a “Douglas Pierre”) and Nicole Young (a/k/a “Nicole Pierre” and “Nicole Pierre Smith”) were sentenced Thursday for their participation in a stolen identity tax refund scheme.  They had  previously pled guilty to one count of conspiracy to steal government property, one count of theft of government property, and one count of aggravated identity theft.

On October 5, 2011, six  defendants were charged in a nine count indictment for their participation in a tax refund scheme that resulted in the submission of approximately $1,207,389.00 in fraudulent claims for refunds using the personal identification information of unknowing individuals.  In addition to the Youngs,  Jeffrey Andre Young, Jr., 31, and Ernest V. Charles, 37, both of Miami, and Joseph Bshara, 27, and Siham Benabdallah, 23, both of Miami Shores, Florida, were also charged in the indictment.  Young, Jr., Benabdallah, and Bshara pled guilty and were sentenced. Charles remains at large.

According to the indictment, the Youngs owned and operated two tax preparation companies, Supreme Tax and Young Professional Services, Inc. The Youngs would obtain identification information from unknowing victims and use their identification information without their authorization to file fraudulent refund claims.

Douglas Young was sentenced to 61 months’ imprisonment, followed by three years of supervised release. Nicole Young was sentenced to 54 months’ imprisonment, followed by three years of supervised release. In addition, the defendants were ordered to pay joint and several liability restitution in the amount of $849,052.87.

Source: U.S. Attorney’s Office, Southern District of Florida

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