Thread: Illegals bilk taxpayers in $13 million fraud ring

WND INVASION USA

Illegals bilk taxpayers in $13 million fraud ring

'This is an extraordinarily serious, large case'

Posted: April 06, 2010
9:24 pm Eastern
By Chelsea Schilling
© 2010 WorldNetDaily



Twelve illegal aliens have pleaded guilty to swindling taxpayers out of more than $13 million in a major, four-year scheme in which tax firms catering to Hispanics claimed more than $22 million in fraudulent tax credits or deductions.

Acting U.S. Attorney Kevin F. McDonald for the District of South Carolina told the Greenville News, "This is the largest tax fraud case that I'm aware of ever occurring in the district of South Carolina. This is an extraordinarily serious, large case."

McDonald told the newspaper that two tax preparation companies, Seguros Internacionales, in Spartanburg and Forest City, N.C., and Poz Servicios Para Hispanos, in Boiling Springs, and associated individuals filed at least 10,000 federal income tax returns and claimed more than $22 million in refunds. The two firms are said to have been shut down.

According to the report, nine illegals pleaded guilty to conspiracy to commit mail fraud and to entering the U.S. without authorization. They are Edgar Carrillo-Borjas, Miguel Angel Carrillo-Borjas, David Hernandez-Juarez, Ariana Canseco-Orozco, Maribel Juan-Orozco, Cristina Sanchez-Perez, Juan Carlos Carrillo-Roy, Carlos Carrillo-Rodriguez, all from Mexico, and Luis Gerardo Mora-Vargas, from Costa Rica.

A tenth illegal alien, Omar Maldonado-Cardenas, of Mexico, pleaded guilty to mail fraud and illegal entry. Senior U.S. District Judge G. Ross Anderson Jr. accepted the pleas, and the defendants will soon face sentencing.

McDonald said at least 20 people were involved in the tax fraud ring. Most of the bogus tax credit claims involved alleged child care-related expenses. The Internal Revenue Service paid out $13 million in refunds before investigators spotted the fraudulent returns.

Two others, Juan Manuel Galban Ortega and Rodolfo Magana Escoto, both from Mexico, confessed to burning records from Seguros Internacionales, the Greenville News reported. They pleaded guilty in federal court to obstruction of justice in February.

The 12 convicted defendants face maximum sentences of five to 20 years. McDonald said they will be deported upon completion of their sentences.

The case is being investigated by the IRS, the U.S. Postal Inspection Service and U.S. Immigration and Customs Enforcement. Federal authorities made at least five more arrests last week. Yolanda Poz of Boiling Springs, Lisa Mendoza of Spartanburg, Teresa Bravo of Pacolet and Ashley Moore of Forest City and another unidentified person have been charged with conspiracy to commit mail fraud.

However, tax-fraud schemes are not a new development in the illegal-alien community.

Edwin Rubenstein, president of ESR Research, business researcher, financial analyst and economics journalist, released a report last year documenting abuse of the Earned Income Tax Credit, or EITC. The EITC is a refundable credit that can be collected by low-income workers who pay no income taxes.

Rubenstein's 55-page report is titled "The Earned Income Tax Credit and Illegal Immigration: A Study in Fraud, Abuse, and Liberal Activism." It was published in "The Social Contract," a quarterly journal of public affairs. http://www.thesocialcontract.com/docs/t ... 9apr09.pdf

"At a cost of more than $44 billion per year, EITC spending dwarfs that of the traditional welfare program – Temporary Assistance for Needy Families (TANF) – and food stamps combined," Rubenstein explains. "More than 23 million households currently receive the credit."

He added, "Immigrants accounted for about 13 percent of the U.S. population in 2008 but receive an estimated 26 percent of EITC benefits – about $12 billion."

EITC proponents claim it is an effective anti-poverty program that helps the "working poor." However, Rubenstein explains that the program is dominated by fraud.

"Year after year about one-third of all EITC returns are based on illegal multiple returns, phony Social Security numbers or claims of nonexistent children or spouses," he wrote. "A disproportionate share of illegal alien households receive the benefit."


2007 IRS poster advertising opportunity to get an advance on the Earned Income Tax Credit. These posters are available in Spanish as well.

Rubenstein said the incentive to cheat on taxes is huge because a worker with two children who earns less than $38,646 could receive an EITC payout of up to $4,824 in 2008. Another tax credit – the Additional Child Tax Credit, or ACTC – would pay the same person another $1,126 if their income was less than $16,000.

"For most families in this income bracket, the EITC check is the largest single sum of money they will receive in the course of the year," Rubenstein states.

While EITC recipients are required to have valid Social Security numbers, he notes, "In practice, identity theft, counterfeit Social Security cards and other scams easily nullify such restrictions. EITC outreach groups … offer tips as to how immigrants can receive EITC payments for years in which they did not have a valid SSN. As a result, illegal aliens are estimated to receive the EITC at even greater rates than their legal counterparts."

He writes that illegal aliens often obtain fraudulent Social Security cards by targeting young children and infants. The numbers are stolen from medical documents and used to file returns.

"The fraud can go undetected for years – until the child looks for a job as a teenager," he explained.

Rubenstein adds that the ACTC is even available to illegals without Social Security numbers. They simply use an Income Taxpayer Identification Number, or ITIN, which he says the "IRS is only too happy to provide."

According to the report, the General Accounting Office has reported that the IRS estimates between 27 and 32 percent of EITC dollars are collected fraudulently.

http://www.wnd.com/index.php?fa=PAGE.view&pageId=137225

Well,well.... South Carolina, you don't say? You mean the state of Lindsey Graham?

Related article which was on our homepage:
http://www.alipac.us/article5090.html

"Rubenstein said the incentive to cheat on taxes is huge because a worker with two children who earns less than $38,646 could receive an EITC payout of up to $4,824 in 2008. Another tax credit – the Additional Child Tax Credit, or ACTC – would pay the same person another $1,126 if their income was less than $16,000."



Stop the Nonsense, Pass the FairTax

www.fairtax.org

Judy wrote:

Stop the Nonsense, Pass the FairTax

People cheat on their taxes; they do it now, and they'd find ways to do it under a sales tax. Don't you think it a little naive to believe there won't be abuses with a Fairy Tax, especially where the service industry is concerned? With all of the taxes we'd owe being lumped into one big sales tax, lots of people would figure out a way to evade it. Heck, I have no doubt that there would be a huge demand for black market goods. And as we know, where there's a demand, there will be crooks to take advantage of it.

Originally Posted by MW

Judy wrote:

Stop the Nonsense, Pass the FairTax

People cheat on their taxes; they do it now, and they'd find ways to do it under a sales tax. Don't you think it a little naive to believe there won't be abuses with a Fairy Tax, especially where the service industry is concerned? With all of the taxes we'd owe being lumped into one big sales tax, lots of people would figure out a way to evade it. Heck, I have no doubt that there would be a huge demand for black market goods. And as we know, where there's a demand, there will be crooks to take advantage of it.

That really doesn't bother me at all, MW. That's a problem for the states to deal with, they're paid well by the FairTax to collect all the FairTaxes, and the more they collect, the more money the state makes, because they're on commission. In addition, competing retailers and citizens will be reporting these FairTax cheaters in ways they can't now report income tax evaders.

It will be a much better system and tax fraud will be at its lowest levels in decades.

Judy wrote:

It will be a much better system and tax fraud will be at its lowest levels in decades.

Not everyone, not even some of the so-called experts, shares that opinion.

MW, if we don't pass the FairTax to repeal the income tax with a national retail sales tax on new products and services with a Rebate up to the family consumption allowance, you're going to end up with an income tax and a national sales tax on everything.

In fact, Paul Volcker has already recommended it

http://www.foxnews.com/politics/2010/04 ... added-tax/

Updated April 07, 2010

Obama Economic Adviser Says U.S. Should Consider 'Value Added Tax'

NYPost.com

"A VAT is a national sales tax that, like state and city sales taxes, would be collected by retailers.

"Acknowledging it would be a highly unpopular move, White House economic adviser Paul Volcker said yesterday the United States should consider imposing a "value added tax" similar to those charged in Europe to help get the deficit under control.

"A VAT is a national sales tax that, like state and city sales taxes, would be collected by retailers.

"Volcker, at the New-York Historical Society, told a panel on the global financial crisis that Congress might also have to consider new taxes on carbon and energy.

"The VAT suggestion was immediately met with outrage by Republicans.

""It shouldn't surprise anyone that the Obama White House would advocate a European-style tax to help finance their European-style government health-care plan," said Brian Walsh, a spokesman for the National Republican Senatorial Campaign Committee.""

____________________________

MW, the income tax has totally failed in its purpose. It doesn't collect enough revenue from the people responsible for the cost of government spending. The progressive rates don't work, because if you actually tax at the higher rate, you lose the source of the tax when they go out of business or leave the country which requires 70,000 pages of nutty loop-holes to try to offset the damage but can't, you deceive the bottom-half of the population to believe money grows on trees and if you don't pay to support your own government, then someone else should and will and if they don't it's not your problem "give me some more food stamps, free school lunch, tax welfare credits, unemployment, COBRA, trade adjustment act, useless government contracts, purposeless farm subsidies, disgraceful HUD Slave Cabins, MediCaid, SCHIP and a government job to boot" anyway, which then falls on the middle and upper middle class to fund it for everyone with no protection, no chance to "just say no", and is an ultimate means of enslaving, demoralizing, and robbing the actual producers, innovators, workers and job and income generators of our nation. It actually punishes the independent self-sustaining citizen, investors, savers, employers and wealth-builders responsible for a producing a successful economy which of course is why we no longer have one.

The mandated income tax system designed largely to rob the population at the point of gun by a welfare police state has been an EPIC FAIL in the United States. When it started out the rates were so low because government was so small, that the effects were marginal because we had immigration controls, no welfare to speak of, no redistribution of wealth from those who earned it to those who didn't, and no free trade.

But even then, Republicans knew as we should all know today that once you give the government the right to rob your income, it will ultimately rob your life and bankrupt your nation. Republicans adamantly opposed the Federal Income Tax in 1913 as well as the formation of the Federal Reserve 9 months later.

I truly don't understand why anyone let alone any Republicans would defend the mandated income tax system over the voluntary FairTax. And so far, none can articulate it. They post these years old juvenile attempts to discredit the FairTax from the Anti-FairTax Lobby that's comprised of socialists, tax preparers, lawyers, accountants, debt collectors and IRS employees and contractors. I also don't understand any person or business who wants to file an income tax return with the US government and report on and disclose every bit of income, holdings and assets, savings, retirement, interest, stock and real estate they own and every expense they have in order to gain an offset from a tax they claim they want to pay!

It's the most illogical thing I've ever witnessed. How we came to arrive at a stage of American History where the US government knows more about the private lives and private business of our country's citizens and businesses than they do, is a tragedy too sad to tell. It just needs to be stopped and the law allowing it repealed and replaced with the FairTax.

Besides, if we don't pass the FairTax this year or early next, there won't be enough income generated to support our Defense Department let alone the rest of our government.

Judy wrote:

MW, if we don't pass the FairTax to repeal the income tax with a national retail sales tax on new products and services with a Rebate up to the family consumption allowance, you're going to end up with an income tax and a national sales tax on everything.

A recommendation is simply that, a recommendation. If the Fairy Tax was to pass and the 16th Amendment wasn't repealed, we would eventually end up with both. Do you really think the Congress is going to repeal the 16th Amendment? Sorry, I just don't see it happening anytime soon. Furthermore, what makes you think the President and Congess will even consider the Fair Tax? As you can see, it's not even a consideration. The VAT recommendation proves that. Sorry, the government just isn't going to give up their primary source of revenue - income tax.

Originally Posted by MW

Judy wrote:

It will be a much better system and tax fraud will be at its lowest levels in decades.

Not everyone, not even some of the so-called experts, shares that opinion.

Really?!! Who might these "so-called experts" be , MW? Because I'm an expert and have spent 30 years working with experts and I don't know a soul among them that defends the mandated income tax system over the FairTax.