Defendants Sentenced in Massive Stolen Identity Refund Fraud Scheme

DALLAS—Two defendants who were convicted on felony offenses related to their roles in a scheme to use stolen identity information to fraudulently obtain millions of dollars in tax refunds were sentenced this afternoon in federal court in Dallas.

George Ojonugwa, 32, of Garland, Texas, was sentenced to 174 months in federal prison and ordered to pay $15,979,187 in restitution.

Eseos Igiebor, 43, of Richardson, Texas, was sentenced to 96 months in federal prison and ordered to pay $9,660,658 in restitution.

Defendant Ogiesoba City Osula, 38, of Dallas, will be sentenced next month. He was convicted following a nearly one week-long trial in October 2013 on one count of conspiracy to commit wire fraud, mail fraud, and bank fraud; seven counts of presenting fraudulent claims upon the U.S.; two counts of fraud in connection with access devices and aiding and abetting; and six counts of aggravated identity theft and aiding and abetting.

Late last year, Ebenezer Legbedion, 42, of Lagos, Nigeria, was sentenced to 40 months in federal prison and ordered to pay more than $1 million in restitution, and Evelyn Nyaboke Haley, 34, of Dallas, was sentenced to 60 months in federal prison and ordered to pay approximately $5.7 million in restitution.

Ojonugwa, Igiebor, and Legbedion each pleaded guilty to one count of conspiracy to commit wire fraud. Igiebor also pleaded guilty to one count of aggravated identity theft. Haley pleaded guilty to one count of conspiracy to defraud the government with respect to claims.

The defendants conspired to defraud the U.S. by using stolen identity information and false information to create and electronically file false tax returns to claim refunds. The defendants had the refunds credited to stored value cards or bank accounts opened with stolen taxpayer identity information. Even while the defendants fraudulently obtained millions of dollars in tax refunds, they filed additional fraudulent returns, attempting to obtain millions more in tax refunds for their own use and benefit.

During Osula’s trial, the government presented evidence that Osula and his co-conspirators sent information to and traded information with, a group running a similar scheme in Cincinnati, Ohio. On November 8, 2011, police in a Cincinnati suburb questioned Osula and Ojonugwa, who were in a parked car after midnight with the leader of the Cincinnati ring. A drug detection dog alerted on the vehicle, and when it was searched, police found more than $300,000 in cash and money orders and numerous debit cards. During that incident, while Osula was in a police car and waiting to be questioned, he ate a debit card.

According to documents filed in this case and statements made in court:

SIRF is a common type of fraud committed against the United States government that results in more than $2 billion in losses annually to the United States Treasury. SIRF schemes generally share a number of hallmarks:

• SIRF perpetrators obtain personal identifying information, including Social Security numbers and dates of birth, from unwitting individuals.
• SIRF perpetrators complete Individual Income Tax Return Form using the fraudulently obtained information and falsifying wages earned, taxes withheld, and other data. Perpetrators use data to make it appear that the “taxpayers” listed on the fraudulent 1040 forms are entitled to tax refunds—when in fact, the various tax withholdings indicated on the fraudulent 1040s have not been paid by the listed “taxpayers,” and no refunds are due.
• Perpetrators direct the U.S. Treasury Department to issue the refunds through checks (Tax Refund Treasury Checks) generated by the fraudulent 1040 forms to locations they control or can access in various ways.
• With Tax Refund Treasury Checks now in hand, SIRF perpetrators generate cash proceeds. Certain SIRF perpetrators sell Tax Refund Treasury Checks at a discount to face value. In turn, the buyers then cash the Tax Refund Treasury Checks, either themselves or using straw account holders, by cashing checks at banks or check cashing businesses or by depositing checks into bank accounts. When cashing or depositing Tax Refund Treasury Checks, SIRF perpetrators often present false or fraudulent identification documents in the names of the “taxpayers” to whom the checks are payable.

While this investigation was conducted by IRS-Criminal Investigation; the FBI; the U.S. Secret Service Office in Cincinnati, Ohio; and the U.S. Attorney’s Office for the Southern District of Ohio, provided substantial assistance.

Assistant U.S. Attorneys Mark Penley, Christopher Stokes, and P.J. Meitl prosecuted.