Dallas Man Sentenced To More Than 17 Years In Federal Prison And Ordered To Pay Nearly $16 Million In Restitution For Role In Massive Stolen Identity Refund Fraud Scheme
DALLAS — A Dallas man who was convicted at trial on multiple felony offenses related to his scheme to use stolen identity information to fraudulently obtain millions of dollars in tax refunds, was sentenced this afternoon in federal court in Dallas, announced U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Ogiesoba City Osula, 38, was sentenced by U.S. District Judge Barbara M. G. Lynn to 17 years and six months in federal prison and ordered to pay $15.9 in restitution. Osula was convicted, following a nearly weeklong trial in October 2013, on one count of conspiracy to commit wire fraud, mail fraud and bank fraud; seven counts of presenting fraudulent claims upon the U.S.; two counts of fraud in connection with access devices and aiding and abetting; and six counts of aggravated identity theft and aiding and abetting.
“The investigation and prosecution of individuals who engage in stolen identity refund fraud (SIRF) is a priority in this district,” said U.S. Attorney Saldaña. “We are committed to working with IRS Criminal Investigation and the FBI, as well as other federal, state and local law enforcement partners, to combat all SIRF-related crimes.”
Last month, co-defendants George Ojonugwa, 32, of Garland, Texas, and Eseos Igiebor, 43, of Richardson, Texas, were sentenced. Ojonugwa was sentenced to 174 months and ordered to pay $15,979,187 in restitution. Igiebor was sentenced to 96 months and ordered to pay $9,660,658 in restitution.
Late last year, Ebenezer Legbedion, 42, of Lagos, Nigeria, was sentenced to 40 months and ordered to pay more than $1 million in restitution, and Evelyn Nyaboke Haley, 34, of Dallas, was sentenced to 60 months and ordered to pay approximately $5.7 million in restitution.
Ojonugwa, Igiebor and Legbedion each pleaded guilty to one count of conspiracy to commit wire fraud. Igiebor also pleaded guilty to one count of aggravated identity theft. Haley pleaded guilty to one count of conspiracy to defraud the government with respect to claims.
“The defendants who perpetrated this scheme systematically defrauded the government and the American taxpayer,” said Richard Weber, Chief IRS Criminal Investigation. “The successful take down of this cross-country identity theft ring and the lengthy sentences for the perpetrators sends a clear message that the Internal Revenue Service stands steadfast in the fight against identity theft.”
The defendants conspired to defraud the U.S. by using stolen identity information and false information to create and electronically file false tax returns to claim refunds. The defendants had the refunds credited to stored value cards or bank accounts opened with stolen taxpayer identity information. Even while the defendants fraudulently obtained millions of dollars in tax refunds, they filed additional fraudulent returns, attempting to obtain millions more in tax refunds for their own use and benefit.
“The number of stolen identities and fraudulent tax refund monies in this case are staggering,” said Diego Rodriguez, Special Agent in Charge of FBI Dallas. “We will continue to work with our federal, state and local partners to identify those who turn to computer crime and intrusions in order to profit at the public’s expense, and to hold them responsible for the ruinous impact they impose on the individuals they victimize.”
During Osula’s trial, the government presented evidence that Osula and his coconspirators were sending information to and trading information with, a group running a similar scheme in Cincinnati, Ohio. On Nov. 8, 2011, police in a Cincinnati suburb questioned Osula and Ojonugwa, who were in a parked car after midnight with the leader of the Cincinnati ring. A drug detection dog alerted on the vehicle, and when it was searched, police found more than $300,000 in cash and money orders and numerous debit cards. During that incident, while Osula was in a police car and waiting to be questioned, he ate a debit card.
According to documents filed in this case and statements made in court:
SIRF is a common type of fraud committed against the United States government that results in more than $2 billion in losses annually to the United States Treasury. SIRF schemes generally share a number of hallmarks:
- SIRF perpetrators obtain personal identifying information, including Social Security numbers and dates of birth, from unwitting individuals.
- SIRF perpetrators complete Individual Income Tax Return Form using the fraudulently-obtained information and falsifying wages earned, taxes withheld and other data. Perpetrators use data to make it appear that the “taxpayers” listed on the fraudulent 1040 forms are entitled to tax refunds – when in fact, the various tax withholdings indicated on the fraudulent 1040s have not been paid by the listed “taxpayers,” and no refunds are due. Perpetrators direct the U.S. Treasury Department to issue the refunds through checks (Tax Refund Treasury Checks) generated by the fraudulent 1040 forms to locations they control or can access, in various ways.
- With Tax Refund Treasury Checks now in hand, SIRF perpetrators generate cash proceeds. Certain SIRF perpetrators sell Tax Refund Treasury Checks at a discount to face value. In turn, the buyers then cash the Tax Refund Treasury Checks, either themselves or using straw account holders, by cashing checks at banks or check cashing businesses, or by depositing checks into bank accounts. When cashing or depositing Tax Refund Treasury Checks, SIRF perpetrators often present false or fraudulent identification documents in the names of the “taxpayers” to whom the checks are payable.
While this investigation was conducted by IRS Criminal Investigation and the FBI, the U.S. Secret Service Office in Cincinnati, Ohio, and the U.S. Attorney’s Office for the Southern District of Ohio, provided substantial assistance.
Assistant U.S. Attorneys Mark Penley, Christopher Stokes and P.J. Meitl prosecuted.