A federal grand jury in Montgomery, Ala., returned an indictment charging Lea’Tice Phillips for conspiring to file false tax returns using stolen identities, the Justice Department and the Internal Revenue Service (IRS) announced today. The 37 count indictment charges Phillips with conspiracy to file false claims, wire fraud, computer fraud and aggravated identity theft.
According to the court documents, Phillips worked for an Alabama state agency and had access to state databases which contained means of identification of individuals. Between October 2009 and April 2012, Phillips conspired with Antoinette Djonret and others to file false tax returns using stolen identities. On multiple occasions, Phillips accessed a state database to obtain means of identification. Phillips used her state email to send means of identification to Djonret. Djonret and others used those means of identification to file false tax returns. Djonret and her co-conspirators filed most of the tax returns from her residence in Montgomery. Djonret and her co-conspirators used an elaborate network of individuals to launder the tax refunds. They recruited individuals to purchase prepaid debit cards and to provide the cards to Djonret and her co-conspirators. The fraudulent tax refunds were directed to the prepaid debit cards. Djonret and her co-conspirators would then use the prepaid debit cards to obtain the proceeds. Some of the prepaid debit cards were in the name of Lea’Tice Phillips. In total, Djonret filed over 1,000 false tax returns that claimed over $1.7 million in fraudulent tax refunds.
On Aug. 9, 2012, a federal grand jury in Montgomery returned a superseding indictment charging Antoinette Djonret, Angelique Djonret, Tabitha Stinson, Melba Wilson, Chantresa Hayes and Corey Means for their roles in the same conspiracy.
An indictment merely alleges that crimes have been committed, and the defendant is presumed innocent until proven guilty beyond a reasonable doubt. If convicted, the Phillips faces 10 years imprisonment for the conspiracy to file false claims, 20 years for each wire fraud count, 10 years imprisonment for each computer fraud count and a mandatory two-year sentence for the aggravated identity theft counts. She is also subject to fines, mandatory restitution and forfeiture.
The case was investigated by Special Agents of the IRS – Criminal Investigation. Trial attorneys Jason H. Poole and Michael Boteler of the Justice Department’s Tax Division and Assistant U.S. Attorney Todd Brown are prosecuting the case.
Source: U.S. Attorney’s Office, Middle District of Alabama
Note that this case is related to one reported previously on this blog.
There seem to have been a number of state databases involved in insider breaches over the past 4 years or so. A notice on the U.S. Attorney’s web site mentions ID theft associated with the Alabama Department of Human Resources, but that notice appears to be related to another set of conspirators involved in tax refund fraud, leaving me to wonder which and how many state databases were involved in this particular conspiracy.