Oklahoma Man Sentenced for His Role in Prison Tax Fraud Scheme

According to court documents, beginning in 2011, the defendant’s son, Edwin Forrest Ludwig IV, ran a tax fraud scheme out of the California Correctional Center in Susanville that involved at least seven co-conspirators. Four of the conspirators who were incarcerated at the correctional center obtained personal identification information of other inmates. Co-conspirators who were not incarcerated took this information and prepared and filed false income tax returns with the IRS, claiming refunds that they knew to be false and to which the inmates were not entitled. Ludwig III, who was not an inmate, assisted the scheme by opening bank accounts to deposit the fraudulently obtained refunds and transferring the money for use by the incarcerated co-conspirators.
This case was the product of an investigation by the Internal Revenue Service, Criminal Investigation, the Federal Bureau of Investigation, and the Investigative Unit at the California Correctional Center. Assistant United States Attorney Amy Schuller Hitchcock prosecuted the case.
To date, five co-conspirators have pleaded guilty. Four have been sentenced for their participating in this scheme, including Ludwig IV, who was sentenced to seven years in prison, and one defendant is set to be sentenced later this month. Charges are pending against one remaining co‑defendant. The charges are only allegations; he is presumed innocent until and unless proven guilty beyond a reasonable doubt.