Conspirator in Prison Tax Fraud Ring Sentenced to Additional 2.5 Years in Prison
SACRAMENTO, Calif. — Scott Albert Johnson, 36, of Turlock, was sentenced today by United States District Judge Garland E. Burrell Jr. to two years and six months in prison and ordered to pay $13,854 in restitution for his role in a conspiracy to defraud the United States by filing false claims for federal tax refunds, Acting United States Attorney Phillip A. Talbert announced.
According to court documents, beginning in 2011, Johnson, who was incarcerated on state charges at the California Correctional Center in Susanville, and three fellow inmates participated in a conspiracy to file false claims for federal tax refunds. Johnson and his fellow conspirators obtained the personal identification information of other inmates, with or without their consent, and provided it to three other co-defendants located outside the prison. The co-defendants then used that information to prepare and file false income tax returns with the Internal Revenue Service, claiming refunds that they knew to be false and to which the inmates were not entitled. The proceeds from these refunds were deposited into bank accounts for the personal benefit of the conspirators, and transferred to the inmate commissary accounts. Johnson also filed at least four tax returns in his own name seeking false refunds.
The conspirators filed at least 247 false claims for income tax returns in tax years 2008 through 2011. The IRS stopped some of these refunds, however, approximately 138 fraudulent refunds totaling approximately $219,984 were issued.
“This fraud was perpetrated from behind bars,” said Michael T. Batdorf, Special Agent in Charge, IRS Criminal Investigation. “Johnson and his co-defendants had the time to concoct a scheme to systematically defraud the government and the taxpaying public. Refund fraud is a top priority, and we will continue to aggressively pursue those who undermine the integrity of the U.S. tax system.”
This case is the product of an investigation by the by the IRS, Criminal Investigation, the Federal Bureau of Investigation, and the Investigative Services Unit at the California Correctional Center. Assistant United States Attorney Amy Schuller Hitchcock is prosecuting the case.
To date, three other co-defendants have pleaded guilty and have been sentenced: on July 15, 2015, Edwin Ludwig IV was sentenced to seven years in prison; on July 29, 2016, Judy Mullin was sentenced to 21 months in prison; and on August 19, 2016, Daniel Coats was sentenced to 18 months in prison. The charges against the three remaining defendants are pending. The charges against them are only allegations; they are presumed innocent until and unless proven guilty beyond a reasonable doubt.