IRS Tax Refund Scam Ends Badly For California Businessman

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IRS Criminal Division nabs more tax cheats
A brazen, California-based tax scam involving the filing of fraudulent Internal Revenue Service (IRS) 1040 and 1040X forms that sought massive, unearned refunds has resulted in another prison sentence.

Say goodbye to Genaro De La Fuente, who this month learned that his role brought him a taxpayer-funded trip to a yet-to-be determined Club Fed.

The swindler, who was indicted in 2011, participated in the plot aiming to steal more than $19 million from the IRS in a laughable scam that included public seminars to enlist suckers and co-conspirators.

One of the attendees happened to be an undercover IRS agent wearing a hidden camera.

At Orange County's Ronald Reagan Federal Courthouse, U.S. District Court Judge Josephine Staton Tucker sentenced De La Fuente to a term of 27 months in prison and ordered him partially responsible to pay restitution of nearly $443,000.

Federal agents have the 53-year-old convicted felon in custody today inside the Santa Ana Jail.

Others convicted in the conspiracy case include Ulises Linares, 12 months; Francisco Ramirez, 15 months; and Osman Norales, 87 months.

Go HERE to read the Weekly's prior, indepth coverage of this type of IRS scam.

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Email: rscottmoxley@ocweekly.com. Twitter: @RScottMoxley.

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DonkeyHotay
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IRS, States Call on IBM, LexisNexis, SAS to Fight Tax Fraud

Vexed by persistent scams in which criminals file claims for tax refunds using stolen identities, several states are turning to new computer tools.

The Internal Revenue Service and an increasing number of states are using software to run tax returns through complicated algorithms to ensure that they are legitimate. SAS Institute Inc., LexisNexis Group, International Business Machines Corp. and others have entered the fray to provide the service.

Law-enforcement officials say criminals use stolen identities of people who are off the radar of tax authorities—such as the deceased, incarcerated felons, and residents of Puerto Rico, who aren't liable for federal income tax—and file millions of fake returns each year under the stolen identities.

The IRS last year turned to North Carolina's SAS to fight tax fraud, evasion and underpayment that cost the agency $385 billion a year. SAS uses publicly available data to verify a person's identity instantly.

http://online.wsj.com/article/SB10001424127887324144304578619811891715262.html



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