A former postal worker who was supposed to deliver the mail in a Pennsauken, New Jersey, neighborhood has admitted to stealing federal income tax refund checks worth more than $400,000. Earl Champagne of Willingboro pleaded guilty to one count of theft of U.S. mail and one count of theft of government money.
Prosecutors say that Champagne admitted to diverting 72 tax refund checks totaling $443,000 to other people. Those other people, who were not named in court documents, allegedly approached Champagne with the scheme and directed him to look for checks made out to individuals with “Spanish” names. The reason? The refund checks were not legitimate tax refunds but were instead part of an identity theft scam.
Under the scam, identity thieves stole Social Security numbers belonging to residents of Puerto Rico. Puerto Rico is a prime target for identity thieves: since Puerto Ricans are U.S. citizens, they are eligible for Social Security numbers. Those Social Security numbers often go unused since residents of Puerto Rico don’t have to pay federal taxes unless they have certain kinds of income. That makes it easy for fraudsters who steal those Social Security Numbers to use them for years without detection.
Armed with that knowledge, the unnamed individuals who approached Champagne were involved in the filing of false returns. Once the checks hit the mail, they needed someone to retrieve them. They advised Champagne to either hand those checks over to them directly or let them know where the checks would be so that they could directly intercept the checks. For his part in the scheme, Champagne was paid $50 per check, or about $3,600, over the time frame from March 2014 to July 2014.
If this story sounds wildly familiar, you’re not wrong. Last year, Brooklyn resident – and U.S. postal worker – Oscar Lopez was arrested on charges of conspiracy and theft of government funds. Like Champagne, Lopez was accused stealing tax refunds filed with false Socials Security numbers and handing those refund checks over to third parties (though Lopez was alleged to have been more “hands on” in the scheme than was Champagne).
Even before that, Elian Matlovsky of Staten Island, New York, pleaded guilty to similar conspiracy and theft charges. Matlovsky was one of 14 defendants initially charged in a scheme that authorities described as “one of the nation’s largest and longest running stolen identity tax refund fraud schemes.” Matlovsky and the other defendants were accused of filing more than 8,000 fraudulent U.S. income tax returns seeking more than $65 million in tax refunds using – you guessed it – stolen Social Security numbers, many from Puerto Rico. To collect, Matlovsky and other defendants purchased address lists in New Jersey and New York, all covered by a single mail carrier. Those addresses were used for as mailing addresses for the returns.
The key in all of these schemes, of course, is to find someone like Champagne who is willing to help. Prior to his arrest, Champagne worked for the postal service for nearly 20 years. He now faces up to 15 years in prison and a fine of $250,000 for each charge. Champagne is scheduled to be sentenced on August 3.
This article was written by Kelly Phillips Erb from Forbes and was legally licensed through the NewsCred publisher network.