Providence man pleads guilty to identity theft, filing fraudulent federal tax …

PROVIDENCE — A 22-year-old Providence man has pleaded guilty in federal court to his role in a scheme that collected identifying information of more than 1,200 people and used many of their identities to file fraudulent federal tax returns.

Julian Balbi, 22, pleaded in U.S. District Court in Providence Thursday to four counts of aggravated identity theft, and one count each of theft of government property and conspiracy, according to U.S. Attorney Peter F. Neronha’s office.

The authorities said the fraudulent filings totaled more than $1.8 million.

Balbi is scheduled to be sentenced by U.S. District Judge Mary M. Lisi on Sept. 18.

Balbi and a co-defendant, Richard Lara, 22, of Providence, were arrested by Rhode Island State Police on Jan. 2, 2012, after a traffic stop in which troopers allegedly found 87 U.S. Treasury checks inside Balbi’s vehicle. Lara is awaiting trial on a federal indictment that charges him with four counts of aggravated identity theft and one count each of conspiracy and theft of government property

The Treasury checks were made out to third parties totaling $596,646, allegedly generated by fraudulent tax returns, the U.S. Attorney’s office said.

The police said they also seized several ledgers and notebooks containing personal identity information, such as Social Security numbers and birth dates, of hundreds of people. Some ledgers contained employer information, such as employee identification numbers and addresses, and there was a USB flash drive containing numerous spreadsheets detailing taxpayer information and fraudulent returns that were allegedly filed with the IRS, according to the U.S. Attorney’s office.

According to information presented to the court, the state police executed a search warrant at Balbi’s Providence home, seizing computers and USB flash drives.

The authorities alleged that forensic examination of the computers and flash drives allegedly found spreadsheets containing ledgers identical to those on the flash drives seized from Balbi’s vehicle.

The authorities said they used a search warrant at Lara’s home, seizing another ledger alleged to contain personal identity information that matched information on the flash drive from Balbi’s vehicle.

IRS and U.S. Secret Service agents interviewed 17 people who were listed as payees on the Treasury checks seized from Balbi’s vehicle. All 17 said they did not file the tax returns in question and did not know Balbi or Lara, the U.S. Attorney’s office said.

The IRS analyzed the information associated with the 1,258 people listed on the various ledgers and computers the authorities said they seized from Balbi and Lara. Between April 2011 and January 2012, some 823 fraudulent tax returns seeking refunds totaling $1,854,438 were allegedly filed with the IRS.

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