Newport couple faces taxes on income never earned
BY ROBERT MOORE, Tribune Staff Writer

For Lora and Jamey Costner, a $7,854 federal income tax bill is the
painful indigestion that followed two unsatisfying servings of
identity theft cooked up by two former Koch Foods employees, records
indicate.

The criminal cases involving the Newport married couple and the two
illegal immigrants, who IRS records indicate worked for Koch Foods,
have been resolved in the court system.

The bitter aftertaste that remains is the unpalatable possibility of
having their wages garnished to pay tax bills on income they never
earned at the Morristown chicken-processing plant.

"The overall burden of it all is crushing us, please help," the
Costners wrote in an appeal to U.S. Sen. Bob Corker, R-Tenn. "We have
done all we know to do."

Mrs. Costner says she realized the magnitude of the problem in July
when the IRS informed her that she and her husband failed to report
approximately $30,000 in income they earned at Koch Foods during
2005.

The Costners say it's easy to prove they both worked at Wallace
Hardware in Morristown during 2005. Relatedly, Mrs. Costner maintains
it's child's play to prove they never worked at Koch Foods during
that year.

Tim Steffin, Koch Foods human resources manager, did not return a
telephone call to comment on the identity-theft cases this morning.

Mrs. Costner says the first indication that something might go badly
in July came five months earlier in February when she was out of work
due to an on-the-job injury.

Mrs. Costner says state labor officials told her she should not be
drawing workers compensation benefits through Wallace Hardware
because she had returned to work at Koch Foods the previous month
following another on-the-job injury.

Records indicate that someone using her maiden name — Hale — and her
Social Security number had fallen off a production line at the Koch
Foods deboning plant in the East Tennessee Progress Center, according
to the Newport woman.

"I've never deboned a chicken in my life," she said Wednesday
afternoon.

The foreshadowing for Mr. Costner materialized in April 2006 when
learned that he was in danger of losing his driver's license because
of unpaid citations for speeding and driving without insurance.

The traffic stop came at 3 o'clock in the morning while Mr. Costner
was asleep. Also, the driver reportedly did not speak English.

Police identified Mrs. Costner's impersonator as Elizabeth Velasco
Bautista, who later pleaded guilty to criminal impersonation,
according to Detective Bob Ellis with the Morristown Police
Department.

The interloper in Mr. Costner's life was Douglas Valdez, according to
Ellis. Ellis says Valdez avoided the identity-theft charge because a
judge ruled that it was not a crime to use someone's identity to
obtain employment.

Valdez reportedly served 45 days on other charges. Mrs. Costner says
her sister lived with Valdez at one time, and she's convinced that's
how their identities were stolen.

Mrs. Costner says when she discovered her identity-theft trail
appeared to lead to Koch Foods, she contacted the Koch Foods human
resources manager.

She alleges that Steffin was uncooperative and indicated he could not
verify whether or not the Lora Hale that was working at Koch Foods
had assumed her identity.

In a matter of minutes, the MPD detective conclusively determined
that the woman who was working under the name Lora Hale at Koch Foods
was actually Elizabeth Velasco Bautista.

The response that Mrs. Costner alleges she received from Steffin is
similar to the treatment described by Julie Wheeler, a Maine woman
whose identity was stolen when she lived in Morristown.

Detective Sgt. Randall Noe arrested a 27-year-old Koch Foods employee
named Lucia Perez last week and charged her with identity theft in
connection with the Wheeler case.

Wheeler alleges Steffin was reluctant to act on her complaint. She
was in peril of having to repay $14,000 in disability benefits
because IRS records showed she had been working at Koch Foods for the
past two years.

Wheeler maintains she was living in Maine for the past two years.
Wheeler says she's sorting out the problems involving her disability
payments.

The Costners remain in IRS legal limbo. The agency hasn't begun
garnishing their wages, but Mrs. Costner says she fears that could
begin any day.

What's more, the Costner's $7,854 IRS bill is for the 2005 calendar
year. Mrs. Costner says she believes it's only a matter of time until
they receive a delinquent tax notice for the time the two imposters
worked at Koch Foods during 2006.

Ellis wrote a letter on the Costners behalf, attempting to resolve
the identity-theft morass, but the correspondence didn't bring
immediate results.

Wednesday afternoon, Paul Chapman, a field representative for U.S.
Rep. David Davis, R-Tenn., said he would intervene on the Costner's
behalf.

Chapman says he's been successful in the past resolving issues with
the IRS in cases where it's clear that an error had been made.