California Man Enters Guilty Plea to Identity Theft, Conspiracy as Part of Scheme to File False Income Tax Returns

Anchorage, Alaska – Acting U.S. Attorney Bryan Schroder announced today that a California man pleaded guilty in federal court in Anchorage to one count of conspiracy to commit wire fraud and one count of aggravated identity theft based upon a scheme to use the illegally obtained personal identity information of others to prepare false W-2’s and then file false individual income tax returns in order to get refunds due to others.

Demetrick Ruffin, 41, from Los Angeles, CA, pleaded guilty before Chief U.S. District Court Judge Timothy M. Burgess.

In connection with the guilty plea, Assistant U.S. Attorney Retta Randall advised the court that between January 2009 through March 2010, Ruffin conspired with others to obtain identity information, such as names, dates of birth, and social security numbers, which were then used to prepare false IRS W-2 Forms that contained fabricated wage and withholding amounts. The co-conspirators then took the identity information and falsified documents to tax return preparation services in Anchorage, Eagle River, and Palmer, Alaska, as well as in Los Angeles and Orange County, California, to have tax returns prepared and electronically submitted to the IRS.

The false returns requested refunds totaling between $1,400 and $8,600. In some instances, Ruffin and his co-conspirators used the stolen identity information to claim that the “taxpayers” had dependent children that they did not, in fact, have. By claiming additional dependents, the co-conspirators were able to increase the amount of refunds that the returns generated. In many cases, the defendants applied for refund anticipation loans and had the fraudulently obtained tax refunds loaded onto stored value cards allowing them instant access to the money even if the IRS later rejected the falsely filed returns.

Judge Burgess scheduled Ruffin’s sentencing for July 10, 2017, at 10:00 a.m. The law provides for a total of 20 years in prison, a fine of $250,000, or both, on the conspiracy charge. Under the Federal Sentencing Guidelines, the actual sentence imposed is based upon the seriousness of the offense and the criminal history, if any of the defendant. The crime of aggravated identity theft provides for a mandatory two-year sentence to be imposed consecutively to the sentence imposed on the conspiracy charge.

Ruffin is detained pending sentencing. A fugitive for three years, Ruffin was arrested in July 2016 by the U.S. Marshals.

By that time, Ruffin’s co-conspirators had been sentenced by Chief Judge Burgess. Jameane Bolton-Williams was sentenced to 82 months in prison and ordered to pay restitution in the amount of $91,927.65. Joe Douglas was sentenced to 57 months in prison and ordered to pay restitution in the amount of $43,043.55. Lucille Stansberry was sentenced to 36 months and one day in prison and ordered to pay restitution in the amount of $48,619.95.

“Identify theft related tax refund fraud is a top priority for the IRS. Together with the US Attorney’s Office, we are committed to fighting this growing epidemic,” said Special Agent in Charge Darrell Waldon of IRS Criminal Investigation. “As damaging as it is to the government and our tax system when this type of crime is committed, we know identity theft is emotionally devastating to those victimized by this scourge. This plea today is a victory for every honest taxpaying American, but especially so for those directly impacted by this nefarious crime. During the closing days of this filing season, we warn everyone to be ever vigilant in safe-guarding their personal information.”

Acting U.S. Attorney Schroder commends the IRS Criminal Investigation for the investigation of this case.