Modesto Woman Charged With Submitting 121 Stimulus Check Claims Using PII Obtained Through Her Imprisoned Son
Defendant Charged With Obtaining Personal Identifiable Information Of 9,043 Individuals And Filing For $145,200 In Stimulus Checks
SAN FRANCISCO – Sheila Denise Dunlap was arraigned in federal court today on an indictment charging her with conspiracy to commit wire fraud and aggravated identity theft, announced Acting United States Attorney Stephanie M. Hinds, Internal Revenue Service Criminal Investigation Acting Special Agent in Charge Michael Daniels, and Treasury Inspector General for Tax Administration J. Russell George.
Dunlap, 50, of Modesto, is charged with engaging in a wire fraud conspiracy from March 2020 through July 2020 involving the fraudulent filing for Economic Impact Payment (EIP) payments, commonly known as stimulus checks. EIP payments were included as one of the provisions of the CARES Act signed into law on March 27, 2020, to address the economic fallout of the COVID-19 pandemic in the United States. This provision of the CARES Act provided that individuals who made less than $99,000 on their 2019 tax returns and those whose income was sufficiently low that a tax return filing was not required (known as non-filers) were eligible to receive EIP funds. EIP payments amounted to as much as $1,200 per adult and $500 for a qualifying child.
According to the indictment, Dunlap conspired with her son to obtain the personal identifiable information (PII) of others and used that PII to apply for EIP funds. Her son is imprisoned in San Quentin State Prison. Dunlap communicated with him through telephone and text messaging. The indictment alleges Dunlap’s son sent Dunlap the PII of fellow prisoners and others and, in or around April 2020, he coordinated with an unknown third party to email Dunlap a spreadsheet containing the PII of 9,043 individuals. Dunlap and her son devised a strategy that the first applications should use the PII of the youngest adults on the list as they were more likely to be tax non-filers and thereby qualify for EIP funds. According to the indictment, Dunlap used the PII to file 121 claims for stimulus checks, with all applications directing payment to her bank account. On May 28, 2020, five EIPs in the amount of $1,200 each were electronically deposited into Dunlap’s bank account, each as a payment to a different individual. Dunlap immediately withdrew the funds and used them for personal expenses. In total, Dunlap filed claims for $145,200 in EIP payments.
Dunlap is charged with one count of wire fraud conspiracy, in violation of 18 U.S.C. § 1343 and 18 U.S.C. § 1349. The charge carries a maximum statutory penalty of 20 years in prison and a fine of $250,000 or not more than the greater of twice the gross gain or twice the gross loss. Dunlap is also charged with one count of aggravated identity theft, in violation of 18 U.S.C. § 1028A, which carries a penalty of two years imprisonment and a maximum fine of $250,000. Any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
The charges are merely allegations, and the defendant is presumed innocent unless proven guilty in a court of law.
Dunlap was arraigned today on the indictment before United States Magistrate Judge Thomas S. Hixson. Her next appearances are scheduled for May 27, 2021, at 10:30 a.m. for a hearing regarding release conditions before Magistrate Judge Hixson and a status hearing on May 28, 2021, at 11 a.m. before United States District Judge Susan Illston. She is out of custody on bond.
Annie Hsieh is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Llessica Chan Fierro, along with Ralph Banchstubbs and Maribel Gallegos. The prosecution is the result of an investigation by IRS-CI and TIGTA.