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Identity Thieves Filed for Tax Refunds

Wired reports that a group of "sophisticated" identity thieves received around $4 million from the government by filing fake tax returns for at least three years. Apparently the group was able to use names and Social Security numbers stolen from both the living and the dead. More than 1,900 fraudulent tax returns were filed, and the refunds were directed to more than 170 bank accounts.

Wired said that the group took advantage of the IRS' quick turnaround process for electronically filing returns--these are typically processed without verifying taxpayer information or confirming the actual amount. Rather than sending a check in the mail, the IRS will pipe the funds into a bank account or a pre-paid debit card amount.

In this case, the group, led by 29-year-old Daniel David Rigmaiden, used stolen IDs to create fake online and phone accounts using 175 different IP addresses. The fake returns were filed in bulk, making it appear as if they were submitted through an automated process. The FBI caught Rigmaiden back in May 2008, and since has charged him--along with side-kick 43-year-old Ransom Marion--with 35 counts of identity theft, 35 counts of wire fraud, one account of unauthorized computer access, and two accounts of mail fraud.

Authorities were tipped off about the scheme when another criminal--facing unrelated state charges in another fraud case--told them about Rigmaiden. The FBI signed him on as an informant who in turn slipped his way into the network and eventually uncovered one of Rigmaiden's IP addresses. Agents then located Rigmaiden's home and put him on surveillance--eventually he was finally arrested after retrieving $9,000 in cash as part of a fake $700,000 IRS refund.

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    Wait, so he only got caught after being ratted out and then while he was under surveilance?

    Is it any wonder these criminals get away with it so easily?
  • ms1191
    How many exactly, get away with it so easily?
  • thejerk
    Two of the best names in criminal history.
  • zoemayne
    So there are probably other people doing this they just haven't been caught the IRS seems to not be countering this(or are just too stupid/slow gov).
  • darkknight22
    This is why if you want to do something evil, you do it alone and you don't tell anyone.
  • Supertrek32
    Okay, now I'm not in any way saying it's a bad thing they got themselves caught, but I can't help but wonder...

    It was $4 million split between 2 people. Why didn't they quit while they were ahead? You could live pretty happily off that.
  • Now see, this is a perect case of would be or wanna be Robin Hood, get the best tax refund for the customer so that they can get more credit for the customer later, unbeknowinced, not a real word now is it, +world -l Webster.

  • kingnoobe
    Easy answer super. Greed. The reason most thieves get caught even the good ones. They always tend to go for more and more.

    I am glad they caught they guys, but I hope that narc gets what he has coming. Then again since he helped catch these guys he probably wont' get crap, and these guys don't seem like the type to kill. Can't say I would feel sad if I heard this guy found in a lake.
  • ssddx
    kingnoobe: I agree that he should get what is coming to him, albiet perhaps with a *slight* break. However, I disagree that he should be found in some lake for snitching. If you're doing evil and someone snitches.. who is really to blame? yourself. Nevermind the fact that the snitch is a criminal already.

    In all seriousness though: I hope the IRS takes this as a leason learned. Fix your system.
  • zak_mckraken
    I'm still amazed every time I read a story involving stealing the identity of dead people. I mean... wth? Don't their software have protection for that? Here's a free hint for them :

    SELECT * FROM T_TaxReturnQuery WHERE Status='NOT DEAD';