MONTGOMERY, Ala. (AP) — Ten people from Alabama and Georgia are accused of obtaining more than $20 million in fraudulent tax returns by stealing identities, including those of military serving in Iraq and Afghanistan.
Federal officials announced the indictment on conspiracy and fraud charges Thursday in Montgomery. They said nine defendants have been arrested and more people could be charged in the ongoing investigation.
U.S. Attorney General Beck said those charged used stolen identities from a credit card calling center in Columbus, Ga.; the Alabama Department of Corrections, and the Fort Benning military hospital in Georgia. Many of the Fort Benning identities belonged to military personnel who had medical exams there before shipping out for assignments in Iraq, Afghanistan and other countries.
"To steal the identity of a soldier serving his/her country is the lowest form of thievery," Beck said at a news conference.
Beck said about 7,000 tax returns were filed using stolen identities and more than $20 million in tax refunds were received between 2011 and 2013. The victims were mostly people who would not be filing a return or would be filing late, such as prisoners, the elderly and military on overseas assignments. Most of the refunds were for earned income tax credits, and they ranged from $1,000 to nearly $6,000, according to the indictment.
The indictment describes a sophisticated organization involving several relatives who are accused of setting up fraudulent tax preparation businesses to get electronic filing identification numbers to file federal tax returns electronically. The refunds were cashed in Alabama, Georgia and Kentucky.
The indictment resulted from a special grand jury that has been investigating identity theft with the help of the Internal Revenue Service. Veronica Hyman-Pillot, special agent in charge with IRS criminal investigations, said identifying and prosecuting tax-related identity theft is a high priority.
Court records show the case began to unfold in February with the arrest of Tracy Mitchell of Phenix City, who worked at the Fort Benning hospital. Investigators reported finding $300,000 in cash in a safe in her home.
Eight more were arrested in the last two days. They are: Mitchell's daughter, Latasha Mitchell of Phenix City; Dameisha Mitchell of Phenix City; Keisha Lanier, of Seale; Sharondra Johnson of Phenix City; her mother, Cynthia Johnson of Phenix City; Mequetta Snell-Quick of Phenix City; Talarious Paige of Phenix City; and Patrice Taylor of Midland, Georgia.
Federal officials said Paige and Taylor worked for a credit card calling center in Columbus, where some identities were obtained. The indictment does not describe how the Alabama prisoner records were obtained.
Some defense attorneys contacted Thursday said they had just received the cases and were not familiar enough with them to comment. Other defense attorneys could not be reached immediately for comment.
In addition to conspiracy, the defendants face various fraud and identity theft charges. Conspiracy carries a sentence of up to 10 years in prison. Wire and mail fraud carry up to 20 years, and aggravated identity theft has a mandatory sentence of two years.
In recent years Beck's office has worked with the IRS to prosecute many cases involving fraudulent tax returns seeking millions in tax refunds, and one of Beck's assistants, Todd Brown, was recognized by the Justice Department last year for his work. But Beck said Thursday this case is their biggest one yet.