An Oahu Man and Two Maui Men Arrested In Connection with Drug Trafficking, Firearm, Illegal Gambling Business, and Money Laundering Charges
HONOLULU –Leihinahina Sullivan, 51, of Lihue, Kauai, was sentenced today before United States District Judge J. Michael Seabright to 17 years in prison and three years of supervised release for three counts of wire fraud and one count of aggravated identity theft related to multiple long-running fraudulent schemes. Sullivan previously pleaded guilty to these offenses in July 2021. She is also required to pay $3,396,035.15 in restitution to various victims and public and private entities and subject to a penalty of $2,012,41.92 in forfeiture for the criminal proceeds of her offenses. In sentencing Sullivan, Judge Seabright described the “staggering scope, length, and complexity” of her criminal conduct.
According to court documents and information presented in court, Sullivan perpetrated three fraud schemes beginning as early as January 2011, through at least July 2019. Sullivan devised a tax fraud scheme involving over $2.8 million in tax loss, mostly in the form of fraudulent tax refunds from the IRS and the State of Hawaii that she and the other individuals were not entitled to receive. She filed hundreds of false tax returns for herself and for others. The false federal and state tax returns included fictitious expenses, claims for credits, and other items Sullivan knew were false when made. Sullivan did not review these tax returns with the individuals before she filed the tax returns in their names and forged their signatures on many of the returns.
According to further information presented to the court, the second scheme involved educational fraud. For college-bound students, mostly located on the island of Kauai, Sullivan prepared and submitted false student loan, grant, scholarship, and financial aid applications and other documents that requested money from public and private educational-based financial assistance and aid providers. Sullivan transferred some money from students’ financial aid applications to her personal bank accounts and other bank accounts that she controlled, then spent the money on her own personal and other expenses, such as for her home construction, retail purchases, and her bills.
In the last fraud scheme, according to information presented to the court, Sullivan used personal identification information of many individuals, such as social security numbers and birth dates, to apply for and use approximately 40 credit cards in other peoples’ names and under their guaranteed lines of credit without their authorization. Sullivan spent over $1 million on these unauthorized cards.
“This 17-year sentence holds Sullivan accountable for the damage she caused by her years-long fraudulent schemes, the money she stole from individuals in her community and public and private institutions, and her repeated and willful rejection of the rule of law.” said United States Attorney Clare E. Connors. “This sentence will stop Sullivan from continuing to prey on vulnerable members of our community who unwittingly trusted her manipulation and lies.”
“Sullivan has spent the last decade spinning a web of lies, committing fraud, and not caring who she hurt in the process. But that ends today, as Ms. Sullivan faked it until she made it to a real-life prison sentence,” said Special Agent in Charge Bret Kressin, IRS Criminal Investigation (IRS-CI), Seattle Field Office. “While crime may seem to pay in the short run, today’s sentence is a reminder that IRS:CI is committed to bringing real-world consequences for fraud. ”
“I am proud of the work of OIG Special Agents and our law enforcement partners for their work in this case and their dedication to protecting the integrity of Federal funds, and in particular, Federal student aid and the students that rely on those funds to make their dreams of higher education a reality,” said Adam Shanedling, Special Agent in Charge of the Department of Education’s Office of Inspector General’s (DOE-OIG) Western Regional Office. "We will continue to pursue those who exploit innocent students and misappropriate Federal student aid or game their system for their own selfish purposes.”
IRS-CI conducted the investigation resulting in the indictment, in partnership with DOE-OIG, the FBI, and the State of Hawaii, Department of Taxation. Assistant U.S. Attorneys Rebecca Perlmutter and Mohammad Khatib prosecuted the case.