Man Pleads Guilty to Identity Theft and Tax Evasion

A New Jersey man pleaded guilty Wednesday, January 30, 2013, in connection with his role in a large-scale identity-theft scheme. If convicted, he faces up to 52 years in prison. This case is being investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), FBI, Internal Revenue Service's (IRS) Criminal Investigation and the Bergen County Prosecutor's Office.

Sang-Kyu Seo, 63, of Palisades Park, N.J., pleaded guilty to charges of conspiracy to unlawfully produce identification documents and false identification documents, aggravated identity theft, conspiracy to commit wire fraud, conspiracy to commit bank fraud and tax evasion.

According to court documents, Seo was the owner and operator of Hang Jin Yi Inc., doing business as Hwangini, a salon located in North Bergen, N.J., and Pier 7 Corporation, a purported small business located in Palisades Park.

Seo conspired with Sang-Hyun Park, aka Jimmy, and others, to obtain a Social Security number beginning with the prefix '586' for another individual. These 586 Social Security numbers were issued by the U.S. to individuals, usually from China, who were employed in American territories, such as Guam. Park is alleged to have been the leader of a criminal organization headquartered in Bergen County that obtained, brokered and sold identity documents to customers to commit credit card fraud, bank fraud, tax fraud and other crimes.

Park pleaded guilty Jan. 9 to his role in the enterprise, and is awaiting sentencing.

This criminal enterprise engaged in the fraudulent 'build-up' of credit scores associated with the Chinese identities. They did so by adding the Chinese identity as an authorized user to the credit card accounts of various co-conspirators - members of the enterprise's credit build-up teams who received a fee for this service. By attaching the Chinese identities to these existing credit card accounts, the teams increased the credit scores associated with the Chinese identities to between 700 and 800. The members of the build-up teams did not know the real person to whom the identity belonged or virtually any of the customers who had purchased the identities.

After building up the credit associated with these identities, Park and his co-conspirators directed, coached and assisted the customers in opening bank accounts and obtaining credit cards. Park and his co-conspirators then used these accounts and credit cards to commit fraud. Park relied on several collusive merchants who possessed credit card processing machines. For a fee, known as a 'kkang fee,' these collusive merchants charged the fraudulently obtained credit cards, although no transaction took place. After receiving the money into their merchant accounts from these fraudulent transactions, the collusive merchants gave the money to Park and his co-conspirators, minus their kkang fee.

Seo admitted that he obtained a 586 Social Security card and counterfeit driver's licenses through Park for a family member, who then used this identity to 'bust out' credit cards. Seo also admitted that he gave his corporate and personal credit cards to Park for the purpose of 'busting out' these maxed-out credit cards. In furtherance of this conspiracy, Park and his co-conspirators issued worthless checks, drawn on bank accounts that had been established using the 586 identities, as payment toward the balances on Seo's credit cards.

Before the banks and credit card companies realized that these checks were bogus, Park and his co-conspirators charged Seo's credit cards through collusive merchants or used them to purchase merchandise.

Seo also admitted that in 2007, with the assistance of a loan broker, he fraudulently obtained a $100,000 commercial loan on behalf of Pier 7. Seo admitted that he and the loan broker made false statements to obtain the loan including falsely representing that his businesses annual revenue was about $620,000.

Finally, Seo admitted that he committed tax evasion by issuing checks to himself and others, representing income derived through the operation of Hwangini, and then failing to report this income on his personal tax returns.

Seo admitted that in April 2008, he filed an individual income tax return for tax year 2007. This return declared that his taxable income for calendar year 2007 was about $197, and the amount of tax due and owing was about $19. Seo admitted that this return failed to include $304,848 in additional taxable income that he had received in 2007, thus having an additional tax of $81,643 due to the United States government.

Seo's sentencing is scheduled for May 14.

Woman Sentenced for Using Fake I.D. to Receive Government Benefits

A Twin Cities woman was sentenced in federal court Friday, January 18, 2013, for using an alternative identity to fraudulently receive government benefits, including more than $18,000 in Low Income Housing Tax Credits (LIHTC) from the U.S. Department of Housing and Urban Development (HUD).

Oluremi George, 53, of Woodbury, aka Victoria Ayoola, pleaded guilty to one count of Social Security fraud and one count of making false statements. She was sentenced to two years of probation, and was ordered to pay $18,114 in restitution. She was indicted July 10.

This sentence resulted from an investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).

"Identity fraud poses a serious security vulnerability, which often contributes to a host of other crimes – including the false identity and financial fraud in this case," said Michael Feinberg, special agent in charge for HSI St. Paul. "Targeting these schemes is an enforcement priority for HSI.  We are committed to working with our law enforcement partners to detect, investigate and dismantle identity fraud."

In her plea agreement, George admitted that she applied for, and received, a Social Security card under the name Victoria Ayoola Nov. 19, 1996. On the application, George indicated that she had never before been issued a Social Security number. However, she in fact had already received a Social Security number under the name Oluremi George, issued Nov. 26, 1991.

Since 1996, George had used both Social Security numbers and identities to apply for and renew Minnesota identification cards and driver's licenses, to seek and obtain employment, and to file federal and state tax returns. George also used the false identity to receive a lower monthly housing rental rate by qualifying for a LIHTC rental unit at Pondview Townhomes in Woodbury. George's fraud resulted in her underpaying more than $18,000 in rent since 2004.

Pondview is a low-income housing development that provides housing assistance to its residents through the use of HUD loans and funds, as well as through LIHTCs. To be eligible to live in one of the units, a person must make less than the federal annual tax credit income limit. In 2011, that limit for Washington County, where Woodbury is located, was $35,280.

In an effort to qualify for the subsidized housing unit, George certified that her anticipated 2011 income was $30,930, even though she knew it would actually be $55,887.13.

HSI was assisted in this case by the Social Security Administration's Office of Inspector General, HUD's Office of Inspector General, the U.S. State Department's Diplomatic Security Service, and the Minnesota State Patrol, with assistance from the Minnesota Secretary of State's Office.

HSI Arrests Identity Illegal Jamaican National for Aggravated Identity Theft

Cory Howard was living in North Carolina in 2011. While reviewing his credit report, he realized that an unknown person in the state of Florida had opened a Wells Fargo bank account using his personal information. After doing some investigating, Howard learned that the bank account was associated with a Tampa, Fla., address, and he contacted the Tampa Police Department for assistance.

A Tampa Police Department detective embarked on an investigation. Using ATM transaction videos and the address associated with the Wells Fargo bank account, she tracked down Howard's impersonator via a traffic stop. The driver, however, did not present a Florida driver's license bearing Howard's information. Instead, he presented a Florida license indicating that his name was Miguel Cruz. When the detective analyzed both licenses, the images on the licenses bearing both Cruz and Howard's name appeared to be the same person. The driver of the vehicle also appeared to be the same person in the ATM videos.

But was this individual really Cruz?

The detective didn't believe so, and that's why she reached out to Tampa's Homeland Security Investigations (HSI) special agents. HSI special agents are highly trained to identify document and benefit fraud.

"Our special agents didn't leave one stone unturned, searching immigration records and working with law enforcement entities in Jamaica and the U.S. Virgin Islands to identify the impersonator," said HSI Tampa Special Agent in Charge Sue McCormick.

After comparing arrest records and fingerprint samples, the HSI special agents determined that the impersonator was actually Lynval Thompson, a Jamaican national who was illegally residing in the United States.

On Friday, January 11, 2013, Thompson was sentenced to two years in federal prison and one year of supervised release for aggravated identity theft. He will be deported to Jamaica after he completes his prison sentence.

How do you protect yourself from identity theft?

·                             Shred paperwork with personal identifying information before discarding.

·                             Be aware of your surroundings at ATMs. Protect your PIN and account numbers.

·                             Do not enter your credit card number on the Internet (unless you are using a secure site).

·                             Monitor your credit report and bank account statements.

·                             Do not provide personal information to people you do not know. 

Foreign Nationals Sentenced for Trafficking Identities of Puerto Rican US Citizens

Five foreign nationals were sentenced to prison for their respective roles in trafficking the identities of Puerto Rican U.S. citizens and corresponding identity documents, announced Assistant Attorney General Lanny A. Breuer of the Justice Department's Criminal Division; U.S. Attorney Rosa E. Rodríguez-Vélez for the District of Puerto Rico; Director John Morton of U.S. Immigration and Customs Enforcement (ICE), which oversees Homeland Security Investigations (HSI); Chief Postal Inspector Guy J. Cottrell of the U.S. Postal Inspection Service (USPIS); Scott P. Bultrowicz, Director of the U.S. State Department's Diplomatic Security Service (DSS); and Internal Revenue Service-Criminal Investigation (IRS-CI) Chief Richard Weber.

Daniel Aparicio-Lara, 29, a Mexican national formerly of Burlington, N.C., was sentenced Tuesday, December 18, 2012, to 66 months in prison by U.S. District Judge Thomas D. Schroeder in the Middle District of North Carolina. In addition to his prison term, Aparicio-Lara was sentenced to serve three years of supervised release and ordered to forfeit $140,800 in proceeds. On Sept. 18, 2012, Aparicio-Lara pleaded guilty in front of Judge Schroeder to one count of conspiracy to commit identification fraud and one count of aggravated identity theft.

Manuel Guzman-Santos, 37, a Dominican national formerly of Worcester, Mass., and Marco Pena, 37, a Dominican national formerly of Dorchester, Mass., were sentenced Monday, December 17, 2012, by U.S. District Judge Joseph L. Tauro in the District of Massachusetts. Both Guzman-Santos and Pena were sentenced to serve 30 months in prison. On Aug. 2, 2012, Guzman-Santos and Pena each pleaded guilty in front of Judge Tauro to one count of conspiracy to commit identification fraud.

Adelfo Perez-Garcia, 36, a Mexican national formerly of Seymour, Ind., and Alma Yesenia Garcia-Ramirez, 29, a Mexican national formerly of Crystal Lake, Ill., were sentenced yesterday by U.S. District Judge Gustavo A. Gelpí in the District of Puerto Rico. Perez-Garcia was sentenced to serve 24 months and one day in prison and Garcia-Ramirez was sentenced to serve 24 months in prison. Judge Gelpí ordered the removal of both defendants from the United States after the completion of their sentences and ordered that Garcia-Ramirez forfeit $35,900 in proceeds. On Aug. 28, 2012, Perez-Garcia pleaded guilty to one count of conspiracy to commit identification fraud in the District of Puerto Rico in front of U.S. Magistrate Judge Silvia Carreño-Coll. On Sept. 4, 2012, Garcia-Ramirez pleaded guilty to one count of conspiracy to commit alien smuggling for financial gain in the District of Puerto Rico before U.S. Magistrate Judge Bruce J. McGiverin.

The five defendants were charged in a superseding indictment returned by a federal grand jury in Puerto Rico Mar. 22, 2012. To date, a total of 53 individuals have been charged for their roles in the identity trafficking scheme, and 23 defendants have pleaded guilty.

Court documents allege that individuals located in the Savarona area of Caguas, Puerto Rico, obtained Puerto Rican identities and corresponding identity documents. Other conspirators located in various cities throughout the United States (identity brokers) allegedly solicited customers and sold Social Security cards and corresponding Puerto Rico birth certificates for prices ranging from $700 to $2,500 per set. The superseding indictment alleges that identity brokers ordered the identity documents from Savarona suppliers, on behalf of the customers, by making coded telephone calls. The conspirators are charged with using text messages, money transfer services and express, priority or regular U.S. mail to complete their illicit transactions.

Court documents allege that some identity brokers assumed a Puerto Rican identity themselves and used that identity in connection with the trafficking operation. Their customers allegedly generally obtained the identity documents to assume the identity of Puerto Rican U.S. citizens and to obtain additional identification documents, such as legitimate state driver's licenses. Some customers allegedly obtained the documents to commit financial fraud and attempted to obtain a U.S. passport.

According to court documents, various identity brokers were operating in Rockford, Ill.; DeKalb, Ill.; Aurora, Ill.; Seymour, Ind.; Columbus, Ind.; Indianapolis; Hartford, Conn.; Clewiston, Fla.; Lilburn, Ga.; Norcross, Ga.; Salisbury, Md.; Columbus, Ohio; Fairfield, Ohio; Dorchester, Mass.; Lawrence, Mass.; Salem, Mass.; Worcester, Mass.; Grand Rapids, Mich.; Nebraska City, Neb.; Elizabeth, N.J.; Burlington, N.C.; Hickory, N.C.; Hazelton, Pa.; Philadelphia; Houston; Abingdon, Va.; Albertville, Ala.; and Providence, R.I.

According to court documents, Aparicio-Lara admitted that he was an identity broker who operated in North Carolina and Missouri; Guzman-Santos and Pena admitted that they were identity brokers who operated in Massachusetts; and Perez-Garcia admitted that he was an identity broker who operated in Indiana. Garcia-Ramirez admitted to assisting an Illinois-based identity broker and transferring money on behalf of the organization. The five defendants used either a real Texan or Puerto Rican identity themselves to commit identification fraud and to facilitate their identity trafficking business.

The charges are the result of Operation Island Express, an ongoing, nationally-coordinated investigation led by HSI Chicago and USPIS, DSS and IRS-CI offices in Chicago, in coordination with HSI San Juan. The Illinois Secretary of State Police (Elgin, Ill.) Police Department; Seymour (Ind.) Police Department; and Indiana State Police provided substantial assistance. HSI Dominican Republic and International Organized Crime Intelligence, and Operations Center as well as various ICE, USPIS, DSS and IRS-CI offices around the country provided invaluable assistance.

The case is being prosecuted by Trial Attorneys James S. Yoon, Hope S. Olds, Courtney B. Schaefer, and Christina Giffin of the Justice Department Criminal Division's Human Rights and Special Prosecutions Section, with the assistance of Acting Deputy Chief Jeannette Gunderson of the Criminal Division's Asset Forfeiture and Money Laundering Section, and the support of the U.S. Attorney's Office for the District of Puerto Rico. The U.S. Attorney's Offices in the Northern District of Illinois, Southern District of Indiana, District of Connecticut, District of Massachusetts, District of Nebraska, Middle District of North Carolina, Southern District of Ohio, District of Rhode Island, Southern District of Texas and Western District of Virginia provided substantial assistance.

Potential victims and the public may obtain information about the case at: www.justice.gov/criminal/vns/caseup/beltrerj.html. Anyone who believes their identity may have been compromised in relation to this investigation may contact the ICE toll-free hotline at 1-866-DHS-2ICE (1-866-347-2423) and its online tip form at www.ice.gov/tipline. Anyone who may have information about particular crimes in this case should also report it to the ICE tip line or website.

Anyone who believes that they have been a victim of identity theft, or wants information about preventing identity theft, may obtain helpful information and complaint forms on various government websites including the Federal Trade Commission ID Theft Website, www.ftc.gov/idtheft. 

Joint HSI and IRS Probe Arrests 53 for Identity Theft, Tax Fraud, and Government Theft

Fifty-three individuals charged with theft of government property and identity theft were arrested Wednesday, November 14, 2012, in several municipalities of Puerto Rico following a joint Internal Revenue Service (IRS) and U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) probe.

The case involves a scheme to defraud the United States by fraudulently obtaining and converting to cash U.S. Treasury checks issued by the IRS in connection with fraudulent tax returns filed with the agency. As part of the scheme, tax returns were filed using the personal identifying information of individuals, when in reality, said individuals never filed such tax returns with the IRS. The investigation has revealed that the fraudulent tax returns were filed without the consent of the taxpayers who appear in the returns.

The majority of the defendants would attempt to negotiate the Treasury checks by depositing them in their accounts at financial institutions such as banks and credit unions. Other defendants cashed or attempted to cash the checks at post offices. When a defendant attempted to cash the check at a post office, he or she would present a false identification document such as a driver's license.

If convicted, the defendants face a maximum possible sentence of 10 years on the theft of government property charge, plus two consecutive years if convicted on the aggravated identity theft charge. The investigation is ongoing.

The case is being investigated by the IRS, Criminal Investigation Division, with the collaboration of HSI, the U.S. Postal Inspection Service and the U.S. Secret Service, and is being prosecuted by First Assistant U.S. Attorney Maria A. Dominguez. The Puerto Rico Police Department and the San Juan Municipal Police participated in the arrests.

ICE encourages the public to report suspected fraud and identity theft-related information by calling 1-866-DHS-2ICE.

Texas Lawyer Sentenced for Wire Fraud and Corporate Identity Theft Scheme

A Houston lawyer was sentenced to 18 months in federal prison and 36 months of home confinement Thursday, Aug. 9. This case was investigated by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) Tampa and the U.S. Secret Service's Tampa and Newark, N.J., field offices.

According to testimony and evidence presented at trial, from February 2005 through July 2006, Roger Shoss, 67, of Houston, and codefendant Nicolette Loisel, also a Houston lawyer, conspired to steal the identities of dormant, publicly-traded companies. They then used the corporate identities they had stolen to create fraudulent, empty-shell companies that had the appearance of being publicly traded. They subsequently sold the fraudulent empty-shell companies for a profit. 

The four companies featured in the indictment were Mobilestream Inc., Regaltech Inc., Nanoforce Inc. and Rocky Mountain Gold Mining Inc., which emanated from 3E International Inc., Pacific Chemical Inc., Webgalaxy Inc. and Greensmart Corporation, respectively.

The administrative and money laundering functions of this scheme were headquartered in Pinellas County, Fla. Multiple wire transfers, totaling at least $800,000, were initiated from the Middle District of Florida to Shoss, in payment for the companies. Shoss, in turn, paid Loisel more than $450,000 for her role in the scheme.

"These individuals – both attorneys – conspired to make a profit through a sophisticated investment fraud and money laundering scheme," said Sue McCormick, special agent in charge of HSI Tampa. "HSI works closely with our law enforcement partners to identify and prosecute con-artists like Shoss and Loisel."

In addition to his prison sentence, Shoss is required to pay a final forfeiture money judgment, in the amount of $800,000. This amount represents proceeds obtained by Shoss and Loisel as a result of their criminal activities. A final order of forfeiture was also entered for Shoss' residence in Houston, which was purchased with proceeds traceable to the wire fraud conspiracy. 

"The U.S. Secret Service and HSI continually strive to enhance our law enforcement partnership by leveraging our respective capabilities, expertise and manpower in support of our distinct law enforcement missions," said John Joyce, U.S. Secret Service's Tampa special agent in charge. "The U.S. Secret Service and HSI will continue to effectively investigate, deter and diminish the threat posed by various types of criminals to our nation's financial infrastructure."

A federal jury found Shoss and Loisel guilty of conspiracy to commit wire fraud on May 22. Loisel's sentencing is scheduled for Sept. 4.

Foreign Nationals Charged with Extensive Drug Trafficking and Identity Fraud Scheme

Eleven foreign nationals were charged Thursday, July 19, 2012, in a 90-count superseding federal indictment alleging they conspired to distribute cocaine and engaged in tax fraud, money laundering, identity theft and other financial crimes.

The indictment comes following a multi-agency Organized Crime and Drug Enforcement Task Force (OCDEF) investigation, stemming from an initial Drug Enforcement Administration (DEA) and Anchorage police drug probe. The magnitude of the financial crimes, money laundering and identity theft, resulted in the Internal Revenue Service (IRS) Criminal Investigations and U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) taking a lead role.

According to the indictment, the Dominican and Mexican-national defendants engaged in a conspiracy to defraud the United States by filing false tax returns and illegally claiming millions of dollars in tax refunds. Investigators believe that between January and March the defendants conducted their scheme using names and Social Security numbers of individuals from the Commonwealth of Puerto Rico.

"Today's indictment is a clear warning that anyone who steals the identities of innocent taxpayers and uses the information for personal profit will be aggressively pursued, investigated and prosecuted, in Alaska or throughout the United States," U.S. Attorney Karen Loeffler said. "This case is an example of how interagency cooperation and teamwork can successfully bring down an entire organized criminal conspiracy."

Three laptop computers seized by investigators contained information for approximately $19 million in fraudulent refund claims, 2,600 stolen identities including individual names, Social Security numbers and other identity information. It is also alleged that one or more of the defendants obtained the physical addresses used on the tax returns by stealing mail from mailboxes in and around the Anchorage area.

The defendants obtained Alaska identification cards using the stolen identities, which were necessary to open the numerous bank accounts needed to cash their tax refund checks. They also falsely claimed to be U.S. citizens to obtain the identity documents and open the accounts.

"These criminals illegally posed as U.S. citizens and exploited our financial system for personal gain," said Brad Bench, special agent in charge of HSI Seattle, who oversees HSI investigations in Alaska. "By pooling our unique resources, legal authorities and expertise, HSI and the IRS were able to dismantle a significant scheme to defraud the people of the United States."

"The charges brought forth today against these 11 individuals serve as another reminder that IRS Criminal Investigation is aggressively pursuing those who choose to defraud the government and disrupt the lives of innocent taxpayers," stated Richard Weber, IRS Criminal Investigations chief.

"Drug traffickers' greed clearly has no limits, as evidenced by this investigation," said Douglas James DEA acting special agent in charge. "The DEA is proud of its partnership with the Anchorage Police Department, which brought this case to their federal counterparts, exposing this multi-faceted criminal organization."

The indictment also charges various defendants with submitting false claims for refund, possessing stolen mail, making false claims of U.S. citizenship, committing passport fraud, making false statements to banks and credit unions, and passing forged U.S. Treasury checks, as well as aggravated identity theft.

The fraud charges each carry maximum penalties of between two and 30 years imprisonment, in addition to the five-year mandatory minimum prison term required upon conviction on the drug charges.

The U.S. Postal Inspection Service and U.S. State Department's Diplomatic Security Service also investigated. The case is being prosecuted by the U.S. Attorney's Office for the District of Alaska and the U.S. Department of Justice Tax Division.

An indictment is merely a formal accusation. Defendants are presumed innocent until proven guilty in a court of law.