Federal Jury Convicts Dallas Man In Massive Stolen Identity Refund Fraud Scheme
Defendant and Co-Conspirators Attempted to Fraudulently Obtain Millions of Dollars in Tax Refunds for Their Own Use and Benefit
DALLAS, Texas — After a nearly week-long trial before U.S. District Judge Barbara M. G. Lynn, a federal jury in Dallas has convicted Ogiesoba City Osula, 37, of Dallas, on all 16 counts of a second superseding indictment charging various offenses stemming from his role in a conspiracy to use stolen identities to fraudulently obtain federal income tax refunds. Today’s announcement was made by U.S. Attorney Sarah R. Saldaña of the Northern District of Texas.
Osula’s four defendants charged in the case have entered guilty pleas:
George Ojonugwa, 32, of Garland, Texas; Eseos Igiebor, 43, of Richardson, Texas; and Ebenezer Legbedion, 42, of Lagos, Nigeria; each pleaded guilty to one count of conspiracy to commit wire fraud. Igiebor also pleaded guilty to one count of aggravated identity theft. Evelyn Nyaboke Haley, 34, of Dallas, pleaded guilty to one count of conspiracy to defraud the government with respect to claims.
Specifically, late Friday afternoon, the jury convicted Osula on one count of conspiracy to commit wire fraud, mail fraud and bank fraud; seven counts of presenting fraudulent claims upon the United States; 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 maximum statutory penalties, per count, are: conspiracy to commit wire fraud, mail fraud and bank fraud – 30 years; fraud in connection with access devices – 15 years; and aggravated identity theft – two years. In addition, each count carries a fine of up to $250,000 and restitution could be ordered.
The government presented evidence at trial that Osula conspired to defraud the government by using stolen identity information and false information to create and electronically file false tax returns to fraudulently claim refunds. Osula and his coconspirators had the refunds credited to stored value cards or bank accounts opened with stolen taxpayer identity information. While Osula and his co-conspirators fraudulently obtained millions of dollars in tax refunds, they filed additional fraudulent returns in an attempt to obtain millions more in tax refunds for their own use and benefit.
The government also 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, Osula and Ojonugwa, who were in a parked car after midnight with the leader of the Cincinnati ring, were questioned by police in a Cincinnati suburb. 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:
Stolen Identity Refund Fraud (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.
The investigation was conducted by IRS Criminal Investigation and the FBI. Assistant U.S. Attorneys Mark Penley, Christopher Stokes and P.J. Meitl are prosecuting.