The third, and final defendant, in a wide-ranging identity theft scheme involving fraudulent student loan application and tax returns was sentenced today, announced Untied States Attorney Matthew Schneider.
Schneider was joined in the announcement by Special Agent in Charge Thomas Utz, U.S. Department of Education, Office of Inspector General / Investigations, Special Agent in Charge Timothy R. Slater, Federal Bureau of Investigation, Detroit Division and Special Agent in Charge Manny Muriel, Internal Revenue Service, Criminal Investigations.
Previously, co-defendants Timothy Wilcox, 45 and Paul Adams, 61, both from Jackson, were sentenced to 77 months and 15 months respectively and were ordered to pay restitution in the amount of $1,390,50, all to be paid to the Department of Education as well as the Internal Revenue Service. Meanwhile, earlier today, Katrina Duling, 46, also from Jackson, received one day in custody followed by three years of supervised release and ordered to pay restitution in the amount of $775,312.
According to court records, in December, 2014, defendants Wilcox, Adams and Duling participated a scheme by which they took personal identifying information (PII) of various individuals, including their social security numbers, or recruited other individuals to provide this information to them, which they used to fraudulently apply for and receive federal student financial aid in the name of those individuals. The defendants did not intend to use, nor did they use, the funds obtained for educational purposes as represented in the fraudulent applications In addition, the defendants used the same PII to file false federal income tax returns to claim and receive federal income tax refunds.
The defendants utilized in excess of one hundred individuals’ PII and defrauded the United States Department of Education, in excess of $1,000,000 and defrauded the IRS in excess of $400,000 through fraudulent tax returns.
“Student loan programs are intended to assist students in obtaining a higher education and scams like this harm both students and taxpayers,” Schneider said.
“Federal student aid exists so that individuals can make their dream of a higher education a reality. It’s not a personal slush fund. That’ why ensuring that those who steal student aid or participate in student aid fraud rings are stopped and held accountable for their criminal actions is a big part of our mission,” said Thomas D. Utz, Jr., Special Agent in Charge of the U.S. Department of Education Office of Inspector General’s Midwestern Regional Office. “I’m proud of the work of the Office of Inspector General and our law enforcement partners for stopping this fraud ring and look forward to continuing to work together to protect Federal student aid funds from such calculated plunder.”
“The actions of Katrina Duling, along with the other two defendants, undermine the nation’s confidence in the security of their personal information, particularly when used to falsely obtain loans and receive tax returns they are not entitled to,” said Timothy R. Slater, Special Agent in Charge of FBI Detroit. “By prosecuting cases like this, the FBI, The U.S. Department of Education, and the Internal Revenue Service are sending a clear message to those attempting to steal and tarnish the identities of the general public that their actions will not be tolerated.”
IRS-CI Special Agent in Charge Muriel stated, “The defendants in this case defrauded the public and took advantage of a system which is intended to help students obtain a higher education. IRS CI special agents, working with our federal partners, once again outsmarted the criminals who thought they could get away with it. Just know that if you try to game the system, you will be caught and held accountable.”
This case was investigated by agents of the Department of Education, Office of Inspector General, the Federal Bureau of Investigation and the Internal Revenue Service. This case was prosecuted by Assistant United States Attorney Timothy Wyse.