U.S. Department
of Justice
Final Defendant Sentenced in Stockton Tax Refund Fraud Ring
SACRAMENTO, Calif. — Jeffrey S. Grady, 35, of Stockton, was sentenced today by U.S. District Judge Troy L. Nunley to two and a half years in prison and ordered to pay more than $25,000 in restitution for conspiracy to submit false claims to the IRS and aggravated identity theft, U.S. Attorney McGregor W. Scott announced.
“The harm caused by Mr. Grady and his co-defendants goes beyond simply cheating the government,” said Kareem Carter, IRS Criminal Investigation Special Agent in Charge. “Stealing identities and filing false tax returns is a serious crime that has a devastating impact on the victims. Identity theft is a pervasive crime and stopping it remains a top priority for us.”
According to court documents, Grady and his co-conspirators submitted tax returns to the IRS that falsely claimed that the persons named on the returns were entitled to tax refunds. Grady obtained the names, social security numbers, and other personal identifying information of various individuals and used that information, often without the knowledge of those people, to submit the tax returns in their names. Altogether, Grady took part in submitting at least 150 false tax returns, requesting approximately $94,140 in tax refunds. The IRS paid more than $25,000 in tax refunds based on those fraudulent tax returns. Grady was one of four defendants charged in the same conspiracy and the last to be sentenced.
Christopher Grady, of Stockton, was sentenced on July 13, 2017, to approximately 38 months of time served in custody and ordered to pay more than $250,000 in restitution.
Jacob Cook, of Stockton, was sentenced on September 7, 2017, to serve 30 months in prison and ordered to pay more than $69,000 in restitution.
Tosh Babu, of Stockton, was sentenced on September 21, 2017, to serve 30 months in prison and ordered to pay more than $94,000 in restitution.
This case was the product of an investigation by the IRS Criminal Investigation. Assistant U.S. Attorney Matthew G. Morris prosecuted the case.