Christopher Davis, of Montgomery, Ala., was sentenced yesterday to serve 60 months in prison, announced Assistant Attorney General Kathryn Keneally of the Justice Department’s Tax Division and U.S. Attorney George L. Beck Jr. for the Middle District of Alabama. Davis was also ordered to forfeit $300,559, which represented the proceeds of his offenses. Davis previously pleaded guilty to charges of conspiracy to defraud the United States, wire fraud and aggravated identity theft.
According to court documents and evidence from the sentencing, Davis was the leader of a multi-state tax fraud conspiracy that operated by filing false tax returns using stolen identities, causing the Internal Revenue Service (IRS) to issue tax refunds. Davis obtained personal identifying information from different sources, including a medical facility in Alabama. He and a co-conspirator, Kenneth Blackmon, who was sentenced to serve 51 months in prison in April 2013, would then file false tax returns using the stolen identities in which they would direct the fraudulently claimed tax refunds to be deposited onto prepaid debit cards.
According to court documents, Davis recruited Blackmon and several other individuals involved in the conspiracy to act as paid runners to help with obtaining the refund money. Davis and Blackmon, who both lived in Alabama, would organize trips to Georgia and South Carolina during which the runners would use the debit cards loaded with fraudulently obtained tax refunds to make cash withdrawals at numerous locations across both states, and then provide the cash to Davis and Blackmon. The runners would also buy new debit cards for use in the ongoing scheme. In his plea agreement, Davis admitted that at one point during the scheme he had over 600 stolen identities and 200 prepaid debit cards with him in Georgia.
SOURCE: Department of Justice
And of course, they don’t identify the medical facility in Alabama. I can’t find that information in available court records, either.
I am pleased to see that individuals are being prosecuted for identity theft. However, I wonder if the punishment is enough to really deter someone from engaging in similar activities. He was sentenced to 5 years in prison. IF he spends the entire 5 years in prison (which seems unlikely), that is 3 days each for the 600 identities that he admitted having in his possession. For any of the people whose identity was stolen, I suspect that they spent at least three days trying to get their finances cleaned up and/or obtaining the tax refunds that were due to them. Also, the financial recovery seems to be for the amount of the tax fraud only. What about the costs that healthcare facilities had to pay for breach notification, breach mitigation and/or settlements with OCR?