Among major U.S. cities with the most fraud-related tax filings: Tampa (88,724 returns, with refunds of $468 million); Miami (74,496 returns, with refunds of $280 million) and Atlanta (29,787 returns, with refunds of $77 million).
At the news conference, authorities said the Miami area’s per capita number of false returns based on identity theft was 46 times the national average, and its per capita value of fraudulent refunds was 70 times the U.S. average.
Michael Steinbach, head of the FBI’s Miami office, said the crime has “reached an epidemic level” in recent years. He cautioned the public to safeguard their Social Security numbers, ignore email scams, and tear up personal financial information before putting it in the trash.
At the root of the problem: Scammers filing fabricated tax returns have exploited a hole in the IRS electronic filing system, according to the U.S. Government Accountability Office.
The federal watchdog agency found that the IRS does not match tax returns to the W-2 income forms that employers file until months after the filing season ends on April 15. Employers file them in late February or early March; the IRS does not match them up with employees’ incomes reported on 1040 forms until June.
That’s way too late to catch identity thieves who file false returns in other people’s names early in the year and have already received and cashed the refund check.
So far this year, a total of 79 South Florida defendants have been charged with filing $40 million in fraudulent refund claims through identity theft, according to the U.S. attorney’s office.
Among the major cases unsealed Wednesday: A three-person ring — Serge St-Vill, 62, of Miami, Muller Pierre, 62, of North Miami Beach, and Finshley Fanor, 34, of Lauderhill — submitted thousands of tax returns in the names of mostly dead people, seeking $14 million in fraudulent refunds, according to an indictment.
The most prominent defendant charged this year has been William Joseph, a former University of Miami defensive tackle who played in the NFL for much of the past decade, who pleaded guilty in August to tax-fraud charges.
Joseph, 32, of Miramar, admitted cashing a $10,088 Treasury Department refund check in the name of a person with the initials “I.P.” at a check-cashing store in North Miami in April, according to his plea agreement.
Unbeknown to him, the store was a front for an FBI undercover operation.
At Wednesday’s news conference, the U.S. attorney also highlighted his office’s most tragic case: Last month, a federal jury found a Miami-Dade man guilty of fatally shooting U.S. postal carrier Bruce Parton in December 2010 as part of a plot to steal people’s identities and file fraudulent income-tax refunds in their names.
The jury found that Pikerson J. Mentor, 30, killed Parton, 60, of Pembroke Pines, for his master key so that he and a partner could access mailboxes — and the personal financial information inside the mail — belonging to residents of North Miami-Dade apartment complexes.
Victims of ID theft and tax-refund fraud should contact the IRS through its website, www.irs.gov.