Posted on October 14th, 2013 No comments
A Miami cop who stole 1,000 identities from a police database to score fraudulent income-tax refunds was found guilty in federal court Thursday.
Malinsky Bazile, 28, collected about $140,000 from the scam in 2011-12.
Bazile, who joined the Miami Police Department in 2008, was immediately taken into custody while he awaits sentencing.
Bazile’s prosecution marked the first time a South Florida law enforcement officer was convicted of identity theft and tax-refund fraud, a crime that has spread across the state.
The 12-person federal jury in Fort Lauderdale took less than one hour to convict Bazile, whose trial started Tuesday before U.S. District Judge Robin Rosenbaum.
Assistant U.S. Attorney Michael Berger prosecuted Bazile’s case, which was investigated by an FBI anti-corruption task force, including Miami internal affairs detectives.
Before his arrest earlier this year, Bazile had helped the FBI target another Miami cop, Vital Frederick, suspected of committing the same type of crime. Frederick, 27, was standing trial this week in Miami federal court, with closing arguments on Thursday. A jury will begin deliberations Friday.
Posted on March 18th, 2013 No comments
Malinsky Bazile, a young Miami police officer, pocketed about $140,000 over the past two years — but not in salary for his patrol duties, authorities say.
While on duty, Bazile ran the names of more than 1,000 people in the state driver’s license database, according to a criminal complaint. Then he took their personal information and filed bogus federal income-tax returns, all to score stolen refunds.
Bazile and fellow officer Vital Frederick, separately accused of tapping into the same database, were both arrested Thursday in the first-ever federal prosecution of identity theft and tax-refund fraud involving South Florida law enforcement.
Bazile, 28, of Miramar, and Frederick, 26, of North Miami, who both joined the force in 2008, were arrested by Miami police internal affairs detectives and FBI agents. The officers had their first appearances in Miami federal court Thursday, with bond hearings and arraignments set for next week.
In an unrelated prosecution, federal agents also arrested a state corrections officer Thursday on the same offenses.
The Miami cop arrests were but the latest in a string of city officer take-downs, part of a joint corruption investigation into the department. The main focus: several officers accused of providing protection for a sports-gambling ring or a check-cashing store, both in Liberty City.
Frederick was also charged with extortion in connection with the check-cashing store racket.
But the allegations of police involvement in the growing wave of ID- and tax-refund fraud prompted strong reaction — and disappointment — from others in law enforcement.
“The perpetrators of this type of [tax] fraud have been as diverse as the victims they prey upon,” said Miami U.S. Attorney Wifredo Ferrer. “To date, we have prosecuted Social Security office employees, hospital employees, clinic workers, former NFL players, gang members and violent criminals, to name a few. Today, we sadly add law enforcement to the list of thieves.”
Miami Police Chief Manuel Orosa could not be reached for comment.
Bazile and Frederick are among 11 Miami police officers relieved of duty in recent months who face criminal charges or the loss of their jobs in connection with the corruption investigation, which focused on the North District station in Liberty City.
In the unrelated case, Bernard Beliard, 27, of Miami, a state corrections officer since 2005, was arrested and accused of illegally tapping into an inmate database at the South Florida Reception Center in South Miami-Dade County, authorities say. He was fired Thursday.
All three law officers were charged in separate criminal complaints filed by prosecutors Robin Waugh and Michael Berger.
In the past year, including Thursday’s cases, the U.S. attorney’s office has charged about 130 defendants accused of an estimated $140 million in tax-refund fraud. Convictions have resulted in increasingly higher sentences: On Thursday, Jonathan Torres-Bonilla, 36, of Hollywood, convicted of fleecing $117,000 in tax refunds from the federal government, was slapped with 16 years in prison — the stiffest penalty so far in a South Florida ID-theft, tax-fraud case.
The U.S. government loses billions of dollars a year to refund schemes affecting millions of American taxpayers, according to the Treasury Department. South Florida is considered among the capitals of this type of fraud.
The joint FBI-Miami police corruption investigation was launched a year ago when the Liberty City sports gambling ring was broken up.
Last month, Miami officer Nathaniel Dauphin pleaded guilty to an extortion charge for providing protection for the illegal betting business.
Dauphin, 41, admitted he received between $4,000 and $5,000 from the owner of the illegal business from November 2010 until March of last year. Unbeknownst to him, Miami-Dade police detectives had the place under surveillance, witnessing Dauphin as he took money from the owner of the Player’s Choice, 6301 NW Sixth Ave., a barber shop that fronted for the illicit sports-betting business.
Investigators flipped Dauphin, who wore a wire and targeted other city cops, including Harold James, 29, an eight-year police veteran who resigned in November. He pleaded guilty last month to two extortion charges for protecting the Liberty City check-cashing business.
Also ensnared in that probe: Frederick.
But among the latest corruption cases, Bazile’s stands out for its sheer size, authorities say.
According to a criminal complaint, FBI and Miami police internal affairs detectives installed a tracking device on Bazile’s work-issued laptop in the past year after they uncovered that he had run more than 1,000 “suspicious” searches of people’s names in the Florida Department of Highway Safety and Motor Vehicles database.
Investigators found that Bazile supplied some of those names, with dates of birth and Social Security numbers, to his step-brother Jean Baptiste Charles, to submit false tax returns to the Internal Revenue Service. Charles pleaded guilty last month and faces sentencing in April.
Investigators soon discovered that Bazile also obtained personal information for hundreds of women with the same last names, such as Rogers, Gonzalez, Martinez, Lopez and Sanders, who were between 57 and 61, according to the criminal complaint.
Bazile filed nearly identical tax returns — with fabricated income information — in their names, claiming that each had earned unemployment compensation of $6,500, the complaint said. He sought refunds up to $1,700 each.
Investigators also obtained numerous ATM photos of Bazile last summer as he withdrew thousands of dollars on debit cards loaded with the refunds, which were issued by the IRS.
When investigators confronted Bazile in October, he signed a written confession, admitting he used the state database, withdrew money from the ATM machines on the debit cards, and made between $130,000 and $140,000 in 2011-2012 from the “scheme.”
Investigators searched his home and found more debit cards, as well as ledgers with hundreds of people’s personal data.
Acting FBI special agent in charge William J. Maddalena said police officers such as Bazile and his colleague, Frederick, “have a great responsibility and must be held to a higher standard.”
He added that the FBI’s Miami-area corruption task force was established in 2009 to “ensure these high standards of integrity are met and maintained.”
Posted on October 21st, 2012 No comments
MIAMI – Tax refund fraud has kept federal prosecutors in South Florida busy as the crime continues to grow in popularity. Just this year, two former NFL players pleaded guilty to taking part in tax refund fraud.
“Identity theft, tax refund scams are really no less than a tsunami that is barreling towards us,” said U.S. attorney Wifredo Ferre.
For victims like South Dade’s Lauri King, waiting for help from the Internal Revenue Service is getting harder. She still doesn’t know when the agency may get around to mailing out her refund.
“I think they are overwhelmed,” King said of the IRS. “I think this is something they never planned for, never expected to happen.”
King filed her tax refund seven months ago. She expected to get her refund a few months later, but continues to wait for the IRS to finally act.
“Just two weeks ago, I mentioned to my husband, did we ever get our IRS refund and he said, ‘No,’” King said. “So we called and actually got to talk with a person and she informed us that we had an issue with identity theft.”
Miami has the highest fraudulent tax return rate in the nation according to Ferre.
“Over 74,000 potentially fraudulent returns filed in Miami resulting in $280 million in bogus returns in 2010,” Ferre said. “The city of Miami per capita numbers of fraudulent returns based on id theft was 46 times the national average…this is absolutely outrageous.”
While the IRS investigates an estimated $5.2 billion dollars worth of phony tax refunds nationwide, tax payers like Lauri King are running out of patience while she waits for her tax refund.
“I feel like I’m nobody; I feel like whatever happens, happens,” King said. “It’s a very defeating feeling, you work all year long, you’re one little bit of change you get can back to have a little freedom with. Nope, just a name, just a number that’s all.”
Several weeks ago CBS4 News asked the IRS how many identity theft victims were still waiting to get their tax refunds? The agency said it’s not releasing that information publicly and wouldn’t even let CBS Miami go inside its Plantation Customer Service Center with a camera to talk with taxpayers who are critical of the way the agency’s treating them.
The agencies local customer service offices are so crowded, warning signs are often posted before noon that they don’t have any more time to meet with taxpayers.
“I don’t see anything to assist them with getting a refund or getting the credit processed and going foward in any kind of expedited basis,” Miami tax lawyer Kevin Packman said.
Packman said federal prosecutors are making progress arresting the scammers, but he believes more needs to be done to help the victims and warns victims like Lauri, “Could still be dealing with this somewhere for 12-18 months.”
CBS4’s Al Sunshine asked if he’s heard of people dealing with this for more than a year? Packman answered “Yes, definitely.”
The IRS insists it’s changing procedures, tightening up its electronic processing systems to avoid more scams next season. But what about getting tax fraud victims’ legitimate refunds back this year?
In a prepared statement, the IRS said:
“Refund times can vary depending on the complexity of the case, and we understand the frustration that taxpayer may have that have been identity theft victims. Along with taking steps toward faster resolution of identity theft cases, we are continuously improving the way we track and report on the status of all identity theft cases. We believe these improvements will reduce the time to work identity theft cases in coming filing seasons so that honest taxpayers will receive their refunds sooner. Additionally, better tracking and reporting means that we can spot – and correct – any flaws in the system more quickly.” – Michael Dobzinski, IRS Media Relations Specialist
Still, with bills mounting and the holiday shopping season right around the corner, victims like Lauri think seven months is way too long for the IRS to get her refund back to her.
“The working public needs help to resolve issues like this,” King said. “It’s hard enough going to work every day and now you’re having your money stolen on top of it and then you have to prove your identity to make sure you’re the correct person. I don’t know how far it’s gone, is it just the IRS check, is it other things? Where does it stop, how does the IRS stop it from happening again? Where does it end, does it happen next year, does it happen a year after that?”
A recent Inspector Generals’ report warned these scams could cost Uncle Sam $21 billion dollars in fraudulent tax refunds over the next 5 years. The IRS continues to ask victims to be patient while they wait for their legitimate refund checks to be mailed out.
But it still declines comment on what it’s doing to make sure next year taxpayer refunds end up with the people who earned them, and not the criminals who’ve been so successful stealing them.
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Posted on September 27th, 2012 No comments
TAMPA — The Internal Revenue Service is tripling the number of staff members nationwide who are dedicated to addressing the issue of identity theft tax refund fraud, U.S. Rep. Kathy Castor said.
Castor, the Tampa Democrat, said she was briefed last Friday by IRS officials regarding progress the agency is making to tackle the epidemic of fraud in which the Tampa area leads the nation.
Thieves use stolen personal information — such as names, dates of birth and Social Security numbers — to file tax returns with fake income information and obtain fraudulent tax refunds.
According to a recent inspector general report, thieves in the Tampa area alone stole more than $400 billion last year from federal taxpayers this way. Nationwide, identity thieves are stealing billions from the federal government through refund fraud.
Castor said the IRS assured her it is increasing its screening filters, designed to detect fraudulent returns before refunds are issued. Across the board, law enforcement officials have repeatedly said the fraud is so pervasive, it cannot be stopped by arrests and prosecutions — that the IRS needs to stop sending “refunds” to thieves.
The IRS told Castor that so far this year, it has prevented 2.3 million fraudulent refunds from being issued, totaling $15 billion. That’s compared to 1.4 million fraudulent refunds stopped in 2011, worth $11 billion.
Part of that effort apparently involves increasing scrutiny of tax filings originating from Tampa, Castor noted.
“I said, ‘Geographically, where you know there is an epidemic, like the Tampa Bay area and the state of Florida, I assume filters are place.’ They said yes.
“They say they’re on the cusp of instituting many, multiple new filters to prevent the fraud from happening in the first place,” Castor said.
“So they will flag, for example, multiple returns coming to the same address. That’s a question I keep getting. How can it be that the IRS is sending multiple debit cards and returns to the same address over and over?”
Castor also noted something police have been saying: often crooks will use the same fake numbers repeatedly on numerous returns. For example, two suspects indicted this week were accused of filing 17 tax returns, each seeking refunds of $1,453.
The new filters, Castor says she was assured, “will flag that.”
While Castor was encouraged by the new IRS approach, she added, “I know from the folks coming to my office with checks and calls and people I see in the grocery store, this is still a huge problem and we’ve got to continue to press the IRS until Tampa no longer is number one for tax fraud.”
Castor said that she was told that by October, the agency will reallocate personnel to beef up the number of people dedicated to issues related to ID theft tax refund fraud. The agency will have more than 2,300 people addressing the issue, Castor said. These people are being moved from other areas and are not new hires.
The agency anticipates that by tax season, it will issue about 500,000 personal identification numbers to identity theft victims. The PIN numbers are designed to stop victims from being further harmed by having their real returns rejected.
The agency said it is “modernizing” its efforts to block use of information gained from the Social Security death master file, an online database of deceased individuals with their Social Security numbers and dates of birth. The data has been used extensively by refund fraud thieves.
Castor said she was pleased to see recent efforts by the federal government to address the fraud, including a directive issued this week by the Justice Department to speed up prosecutions and the arrests of some high-profile suspects.
The congresswoman said she spoke to the IRS about a pilot program in Florida in which identity theft victims can sign waivers giving law enforcement access to tax returns filed fraudulently in their names.
Castor said the IRS told her it has issued 750 of those waivers.
The amount of time it has taken the agency to address the issue is “not satisfactory at all,” Castor said. “But there are some positive signs here. We’ve got their attention.”