Archive for May, 2012

Travellers warned of identity theft

Thursday, May 31st, 2012

Identity theft can ruin a holiday

Travellers are being warned to be alert for any opportunities of identity theft while away on holidays or business trips.

The Identity Theft Resource Center (ITRC) warns you cannot trust anyone you meet with your personal information, including housekeeping staff, bellmen, security guards and front desk clerks.

When considering money options while travelling, ITRC recommends that you use cash, traveler’s checks or credit cards for purchases and leave check books at home.

Even when using ATM/Debit cards/Credit Cards, travellers need to be wary of fake ATM machines that are known to have been placed in high traffic tourist areas. Consider restricting the use of your ATM card to securely located Automated Teller Machines.

Business travellers utilising quiet evenings in the hotels to catch up on booking keeping and paying the bills are warned about the number of people who have access to your room. Account and check information can be stolen from the room while the traveller is at meetings.

Suitcases are not a secure way to lock up valuables and ITRC highly recommends the use of in room or hotels safes while you are out of the room.

Travellers should use fanny packs or travel pouches as appose to carrying a wallet or purse in your pocket. Pickpockets can be found in most major cities, especially in high traffic areas that attract business or vacation travellers. Studies revealed they are not just interested in your cash, but your identity from your SSN, checks and driver’s license.

ITRC also recommends travellers don’t take anything in your wallet that is not absolutely necessary, make sure that you have an emergency phone number (contact person) for emergency medical personnel to use and carry photocopies of all travel documents including plane tickets, hotel reservations and passports but keep these in a separate location from the originals.

Nothing says “we’re out of town” more than a pile of newspapers or overflowing mailbox. While away put your mail on “postal hold” and don’t forget to stop delivery of newspapers until you return.

Following these steps ITRC believes will reduce your risk of identity theft.

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Seminar on business ID theft and fraud set

Thursday, May 31st, 2012

FM Trust and the Greater Carlisle Area Chamber of Commerce will hold a free seminar on how to Protect Your Business from ID Theft and Fraud at 8 a.m. on Thursday, June 21.

The featured speakers will be FM staff, Lorie Heckman, compliance and security officer, and Dianne Cornman, business cash management specialist. They will talk about the different means of identity theft, what business owners can do to protect themselves and the features a business checking account should have to keep information secure.

The seminar is free and there are no obligations with attending. It will be held at the chamber meeting room at 212 N. Hanover St., in Carlisle.

Interested participants should RSVP by Thursday, June 14. To RSVP, email, call 234-4515 or visit

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St. Paul man admits role in $2M ID theft scheme that spanned many states

Thursday, May 31st, 2012

A St. Paul man has admitted to being part of group from the Twin Cities whose identity theft, bank fraud and money laundering activities covered more than a dozen states and earned the suspects at least $2 million.

Kevin T. Martin, 45, pleaded guilty Wednesday in federal court in St. Paul to conspiracy to commit bank fraud and aggravated identity theft for his role in the ring that victimized hundreds of people, along with stores and banks, from 2006 through December 2011.

Martin faces up to 30 years in prison on the bank fraud count and a minimum of two years in prison on the identity theft charge.

In court Wednesday, Martin admitted that he and others used stolen driver’s license and bank account numbers from hundreds of unsuspecting individuals to create counterfeit checks and fraudulent identification documents. They would pilfer financial information and identities from cars, businesses, trash cans and mail boxes, and obtained some information from bank employees.

Martin admitted that the checks were passed at stores to buy expensive merchandise that was subsequently returned for cash. The counterfeit checks were also passed at banks, where Martin and the others deposited the checks into victims’ accounts and then made withdrawals from those same accounts.

Some of the counterfeit checks were drawn on accounts at U.S. Bank, Wells Fargo, American Bank of St. Paul, Affinity Plus Credit Union, Healtheast Employees Credit Union, Unity One Credit Union and Western Bank.

Ten other individuals have previously pleaded guilty to their roles in the fraud. On Sept. 29, 2011, Lee Vang, 32, of St. Paul, pleaded guilty to conspiracy to commit money laundering and aggravated identity theft. She admitted using bogus checks to buy items at stores in Minnesota, Iowa, Nebraska, Wisconsin, North and South Dakota and Illinois. The goods were returned for cash, and the proceeds were split among Vang and her cohorts.

On July 20, 2011, Brianna M. Darwin, 26, of St. Paul, pleaded guilty to the same counts. Melissa J. Beaman, 36, of St. Louis Park; Majorie M. Neely, 50, of Minneapolis; Frances E. Jones, 41, recently of Superior, Wis.; Christeena J. Barker, 45, of Coon Rapids; Jamie H. Branson, 45, of St. Paul; Darryl A. Bryant, 54, of St. Paul; Jacqueline Cleveland, 54, of Bloomington; and Ginger L. Halliburton, 45, of North St. Paul, have each pleaded guilty to conspiracy to commit bank fraud and aggravated identity theft. Patricia G. Pnewski, 51, of South St. Paul, pleaded guilty to conspiracy to commit bank fraud.

Steven Maxwell, 44, of St. Paul; Russell Royals, 60, of Minneapolis; Desmon Burks, 37, of St. Paul; and Donyea Collins, 27, of St. Paul, have pleaded not guilty to their charges and are awaiting trial in August.

As a group, the defendants have prior convictions ranging from theft by swindle to identity theft, assault, drugs, forgeries and receiving stolen property.

Star Tribune staff writer Dan Browning contributed to this report.

Paul Walsh • 612-673-4482

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Tampa Man Arrested for Tax Fraud and Aggravated Identity Theft

Thursday, May 31st, 2012

(Source: FBI) – TAMPA—United States Attorney Robert E. O’Neill announces the unsealing of a 32-count indictment charging Russell B. Simmons, Jr. (42, Tampa) with tax fraud and aggravated identity theft. Specifically, Simmons is charged with eight counts of wire fraud, eight counts of filing a false claim with the Internal Revenue Service (IRS), seven counts of theft of government property, and nine counts of aggravated identity theft. If convicted, Simmons faces a maximum penalty of 20 years in federal prison for each wire fraud count, five years in prison for each false claim count, and 10 years in prison for each theft of government property count. He faces a mandatory sentence of two years in federal prison for each aggravated identity theft count, which must be served consecutive to any sentence imposed for any of the other underlying offenses. The indictment also notifies Simmons that the United States intends to forfeit numerous assets, including approximately $47,580 in cash, $118,275 found on Green Dot and Walmart money cards, a Bentley, and numerous pieces of jewelry, including a Rolex watch, which are alleged to be traceable to proceeds of the offense.

According to the indictment, Simmons, who owned and operated Simmons Auto Sales in Tampa, engaged in a scheme to defraud the U.S. Treasury Department by filing fraudulent income tax returns and negotiating fraudulent tax refunds. Simmons allegedly accepted, purchased, and negotiated U.S. Treasury checks that he knew had been fraudulently obtained, often from individuals purchasing vehicles from his used car lot. Simmons, who knew the refund checks were fraudulently obtained using stolen identities, accepted the U.S. Treasury checks with a much higher face value than the price of the vehicles he sold, keeping the difference for himself. At Simmons Auto, he also accepted, negotiated, and “swiped” reloadable debit cards, commonly referred to as “Green Dot cards,” knowing that they contained fraudulently obtained tax refunds. In some cases, Simmons swiped these cards for individuals who purchased no goods or services from him. Simmons kept a large percentage of the value of these cards for himself and provided the balance to his co-conspirators in cash.

In addition to negotiating fraudulent tax refunds, Simmons personally filed fraudulent federal income tax returns using stolen identities. He then directed that the fraudulently obtained refunds be loaded onto debit cards, which he used at ATMs around the Tampa area.

“Investigating refund fraud and identity theft is a priority for IRS Criminal Investigation,” said IRS Criminal Investigation Chief Richard Weber. “Stealing identities and filing false tax returns is a serious crime that hurts innocent taxpayers. Today’s arrest, a cooperation with the U.S. Secret Service and Tampa Police Department, should serve as a strong warning to those who are considering similar conduct. Law enforcement is serious about investigating these crimes and holding to account those who defraud the government.”

“The arrest of Mr. Simmons is significant due to the sheer volume of tax fraud perpetrated by this individual. Mr. Simmons and others have shown a flagrant disregard for the law and have abused the electronic tax filing system,” said John W. Joyce, Special Agent in Charge, U.S. Secret Service, Tampa Field Office. “The Secret Service and the members of our financial crimes task force will continue to focus our resources on investigations like this that negatively impact the community, the economy, and our nation’s critical financial infrastructure.”

An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.

This case was investigated by the United States Secret Service, the Internal Revenue Service-Criminal Investigation, and the Tampa Police Department. It will be prosecuted by Assistant United States Attorney Mandy Riedel.

This case is being prosecuted as part of Operation Rainmaker, a coordinated effort by various federal and local law enforcement agencies to combat the filing of false tax returns in the Tampa Bay region. Agencies participating in Operation Rainmaker include the U.S. Attorney’s Office for the Middle District of Florida, the U.S. Secret Service, IRS, the United States Postal Inspection Service, the Federal Bureau of Investigation, the Tampa Police Department, and the Hillsborough County Sheriff’s Office.

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2nd Fla. man in ID theft scheme sentenced in Conn.

Thursday, May 31st, 2012

A federal judge in Connecticut has sentenced a Florida man to 22 years in prison for participating in what authorities say was a multi-state identity theft scheme in which he and another man targeted purses in cars.

Michael Johnson of Miami Gardens, Fla., was sentenced Wednesday in U.S. District Court in Hartford. A jury last year found Johnson and Jermaine Jones of West Palm Beach, Fla., guilty of bank fraud, conspiracy and identity theft offenses.

U.S. District Court Judge Vanessa Bryant found that Johnson and his co-conspirators were responsible for stealing or trying to steal more than $2.5 million from more than 150 people.

Johnson, Jones and others recruited women who typically had substance abuse problems to cash the checks at banks.

Jones was sentenced to 20 years earlier this month.

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Tips on Preventing Tax-Refund Identity Theft

Thursday, May 31st, 2012

Bloomberg News

The New York Times recently wrote about increasing tax refund identity fraud. That’s when a thief uses your name, Social Security number and birth date to file a fake tax return with fabricated income and tax-withholding data to collect an improper refund — often, on an easy-to-use prepaid debit card, sent to a specially chosen address.

Then, when you come along and file your (real) tax return, the Internal Revenue Service flags it because one with the same Social Security number has already been submitted. The agency then processes your return manually and scrutinizes everything in it, to authenticate your identity and determine which return is legitimate. The result is months of delays in processing your return and any refund you may rightly be owed.

The fraud is possible in part because the I.R.S. currently processes refunds as quickly as possible, and matches up the necessary verifying information later. Most employers, for instance, must provide income information to workers on forms W-2 and 1099 by the end of January. But the employer doesn’t have to file the same information with the federal government until the end of March. So when you file your tax return, the agency doesn’t necessarily have your income information from your employer for immediate comparison.

“That’s all done post-return,” said Janet Krochman, a certified public accountant in Costa Mesa, Calif., who has counseled a few clients who became victims of tax refund fraud. She noted that the verify-later approach is generally favored by tax filers, who would balk at waiting six to nine months for a legitimate refund. “No taxpayer,” she said, “wants their refund held up pending verification of every document.”

The office of the National Taxpayer Advocate, which represents the interests of tax filers, has recommended that the I.R.S. identify ways to eliminate the lengthy gap between processing refunds and reconciling eligibility. “This sequence makes little sense,” the advocate’s report for 2009 said. “From a taxpayer perspective, the sequence leads to millions of cases where taxpayers inadvertently make overclaims that the I.R.S. does not identify until months later, exposing the taxpayer not only to a tax liability but to penalties and interest charges as well. From the government’s perspective, this sequence creates opportunities for fraud and requires the I.R.S. to devote resources to retrieving refunds that should not have been paid and that it often cannot recover.”

The I.R.S. has been holding hearings on how to move to “real-time” tax processing so it can reconcile information on tax returns more quickly.

With tax refund fraud, fraudsters can either fabricate paper W-2s or other income statements and file the return by mail. Or, more commonly, they simply make up the numbers and file electronically, because they don’t need to submit actual W-2s when filing electronically. By filing early, thieves take advantage of the delay at the I.R.S. in matching up the necessary information.

So what’s a taxpayer to do? One key to the fraud is that the thieves hurry to file early, so that the fake return is the first one received by the I.R.S. That argues for filing your return earlier, rather than later, if you don’t have a good reason to wait, to reduce the chances of a successful fake filing. “The best advice I can give to people is, ‘Don’t wait,’” Ms. Krochman said. “Earlier is going to be better.”

If you owe money and want to pay as late as possible, she said, you can still file your return early and then mail in the payment by check by the annual April deadline.

And if you’re expecting a big refund, you may want to ask yourself why. Adjusting your tax withholdings so that you get just a small refund, or have to write a small check, means you won’t be putting a larger refund at risk in case of any fraud, she said. (Thieves can still use your Social Security number and date of birth to file a fake return with any numbers they want. But if you’re not waiting for a big refund check, a delay in processing your legitimate return won’t cause you undue financial hardship, she noted.)

The Times article noted that Social Security numbers, often pilfered from places like doctor’s offices and hospitals, schools and elsewhere, are crucial to the fraud — as they are with all sorts of identity theft, not just the tax-related version. That argues, as always, for protecting your Social Security number, and those of your children — and asking why the number is being asked for, whenever its requested. (I routinely don’t fill in my number, and my children’s numbers, on medical forms that ask for it, and I have never been questioned about it.)

Nikki Junker, a victim adviser and social media coordinator with the Identity Theft Resource Center, suggests leaving your Social Security card at home instead of carrying it in your wallet, and avoiding giving out personally identifiable information online to reduce your vulnerability to identity fraud in general.

Have you ever declined to provide your Social Security number when asked? Were there any consequences?

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Steps to Identify ID Theft

Wednesday, May 30th, 2012


Last week, the University of Nebraska announced someone had breached security, accessing records of more than 650,000 students and alumni.

Now, it looks like the database included more than just student information.

According to the Lincoln Journal Star, a spokesperson for the university says the database not only included personal records for students, but also personal data belonging to parents of students who applied for financial aid and employees at the college.

That means 650,000 student and alumni records, bank information for as many as 30,000 students, social security numbers, addresses, housing information, financial aid records and transcripts were compromised. The university waited two days to tell the public.

“When an incident happens we bring all of the necessary resources. We had probably 25 to 30 individuals working on this since the moment it happened,” said University of Nebraska security officer Joshua Mauk.

“It’s a pretty amazing feat to do in the scope of 48 hours, considering the scope of the attack,” he said.

Now, parents and employees are being added to the list. So, what do you do if you are a victim of Identify theft?

The Federal Trade Commission has a list of steps that you can take to report any fraudulent use of your identity. They also have a chart to keep track of the people you’ve talked to, so you can stay organized.

The first thing you should do is place a fraud alert on your credit reports by calling any of the three nationwide credit reporting companies. Then check your credit report periodically for any changes.

Second, close the accounts that you think have been tampered with, or opened fraudulently. File a report with your local police station on where the identity theft took place, and file a complaint with the FTC.

Finally, remain alert. Warning signs include missing bills or other mail, receiving credit cards that you didn’t apply for, being denied credit, and getting calls from debt collectors.

You can find the Federal Trade Commission’s Identity Theft website here:

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Lawmakers pledge rigorous identity theft law

Wednesday, May 30th, 2012

Lawmakers in Tallahassee announced plans to work together on a non-bipartisan plan to crack down on tax refund fraud.

In a press conference held in response to an investigation by The Tampa Tribune, lawmakers asserted that they will take steps to make it easier for police and prosecutors bring perpetrators of identity theft to justice.

Law enforcement officials have complained that Florida’s identity theft law complicates prosecution unless if there is conclusive evidence like video and personal identification to pursue case. That means suspects found in possession of Social Security numbers that don’t belong to them, information on birth dates and debit cards with other names cannot be charged with a crime, according to the Tribune. Incidents of criminals and even prison inmates filing false tax returns have increased in Florida in recent years.

Area law enforcement officials applauded the effort to strengthen the law. People “have no legal reason to have ledgers full of people’s names, Social Security numbers and dates of birth,” said Tampa Police Chief Jane Castor in an email statement to the Tribune. “They are up to no good with that type of information. It’s extremely frustrating for officers as they run into suspect after suspect with these ledgers, but they can do nothing about it.


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Bill Targets ID Theft Via Copy Machines

Wednesday, May 30th, 2012

TRENTON—A bill aimed at preventing identity theft through digital copy machines used in banks, doctors’ offices and …

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Barry Dolowich: Identity theft

Wednesday, May 30th, 2012

Recently, I have experienced two attempts to acquire personal identity information (also known as “phishing”) from unwitting people like you and me. I would like to share these two experiences with you.

A client of mine received an official looking email that appeared to be from the Internal Revenue Service. The email claimed that my client was entitled to a refund for Social Security recipients and provided a link to the “Internal Revenue Service” website.

The website was a convincing imitation or clone of the actual Internal Revenue Service website and provided yet another link to be used to gather all your personal information (name, Social Security number, date of birth, and even your mother’s maiden name) to claim the refund.

Fortunately, my client did not respond to the email, but instead forwarded it to me. The Internal Revenue Service does not correspond with taxpayers by email! In fact, your email address is not required to be supplied on your individual income tax returns. In other words, the Internal Revenue Service does not even have your email address.

Another client received an official sounding telephone message from their credit card banking institution. The message urgently requested that she immediately call the bank at the toll-free number provided between 8 a.m. and 8 p.m. “Operators will be standing by.”

She called and connected to an official sounding message requesting her to type in her credit card number. Using her good instincts, she

refused to give her credit card number and waited for an agent. An agent appeared on the phone requesting her name, credit card number and the last four digits of her Social Security number.

She refused to give out the information asking the agent the nature of the original call. She was then told by the agent that her account was delinquent. The agent continued to demand her personal information and when my client refused, the agent abruptly hung up on her. My client then verified that her account was current by calling the bank telephone number on the back of the credit card.

With this painful economy, we have to be more and more alert to these types of creative “phishing” scams. Before giving out any of your personal information, ask yourself who initiated the contact. If your bank or creditor initiated the contact, then it already has your information. If you initiated the contact utilizing known telephone numbers, then you will be required to prove your identity.

Barry Dolowich is a certified public accountant in Monterey. He can be reached at 372-7200, P.O. Box 710, Monterey 93942-0710 or

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