Syndicated Local

5 Nigerians Indicted In Tax Return Fraud Scheme

April 23, 2014 / 12:51 PM EDT / CBS Pittsburgh

PITTSBURGH (KDKA) - U.S. Attorney David Hickton has charged five Nigerian foreign nationals with using other people's identities to claim tax refunds.

"We have dismantled a massive stolen identity fraud ring in which the perpetrators used person identifying information stolen off the Internet to open bank accounts, obtain credit cards, and steal millions of dollars from the U.S. Treasury by filing fake tax returns," said Hickton as a press conference Wednesday morning in Pittsburgh.

Over a 10-year period, the alleged scam artists took in over $10 million in false tax refunds before the scheme was detected.

"Stolen identities were not only utilized to open bank accounts, but also to obtain and receive federal tax refunds and credit cards," noted Akeia Conner, a special agent with the IRS.

The fraud came to light because an employee at Widget Financial Credit Union in Erie suspected something amiss and called law enforcement when the alleged perpetrators filed application forms with similar stolen data.

"It takes that kind of partnership, that kind of knowledge, and that kind of diligence on the part of folks who work in financial institutions to bring these cases to light," noted Patrick Fallon, assistant special agent in charge for the FBI.

Among the banks affected was PNC whom Hickton said cooperated fully in the investigation.

Hickton said average citizen in this region and around the country were victims.

"The defendants obtained stolen identity information, including social security numbers, driver license numbers, places of birth, all over the Internet," he said.

KDKA money editor Jon Delano asked Hickton how each of us can safeguard our identity.

"You need to protect your account information and be very stingy about where you give it," he said.

That means don't post online or give out your social security number, driver's license, or credit card numbers, but that's not always possible.

"When you do use the Internet," said Hickton, "you need to take steps to protect yourself. I recommend that people change their passwords at least monthly."

Another recommendation -- check your credit reports at least twice a year.

"If you see any anomalies that don't make sense or applications for loans or for credit that you didn't make, that's a red flag for you," said the FBI's Fallon.

But Fallon warns.

"We're kidding ourselves if we think there's a full proof method of protecting yourself," he said. "The Attorney General of the United States was a victim of one of these schemes, not this scheme, but one of these schemes."

Here's another piece of advice.

File your tax returns early.

These alleged scam artists got tax refunds because they filed returns before the people whose identity they stole filed.

Had the taxpayers filed before the scammers, the IRS would have known something was up.

Bottom line, it's not easy to safeguard your identity, but this case suggests that we can all do better.

Fraud
Indictment