Defendant Called 'The Hacker' by Law Enforcement Sentenced to 68 Months and Ordered to Forfeit More Than $470,000
|U.S. Attorney’s Office April 07, 2014|
PHOENIX—On April 7, 2014, Daniel David Rigmaiden, 34, formerly of Santa Clara, California, was sentenced by U.S. District Judge David G. Campbellto 68 months in custody (time served) and ordered to perform 100 hours of community service during a three-year term of supervised release. Restitution of more than $395,000 was satisfied by the forfeiture and abandonment of Rigmaiden’s seized assets, totaling more than $470,000. Immediately prior to sentencing, Rigmaiden pleaded guilty to conspiracy, mail fraud, and two counts of wire fraud.
“This sentence and asset forfeiture reflects the seriousness of Rigmaiden’s scheme to defraud the Internal Revenue Service,” stated U.S. Attorney John S. Leonardo. “The defendant tried to avoid apprehension through a sophisticated web of false identities, encryption, and anonymizing programs. Only through sustained collaboration and the coordination of the joint efforts of IRS-CI, FBI, USPIS, and this office was Rigmaiden located and identified. The U.S. Attorney’s Office will continue to work with our law enforcement partners to identify and prosecute those who assume the identity of others in order to defraud the United States.”
“Tax-related scams are becoming more widespread and increasingly complicated, which is demonstrated by this case. IRS-Criminal Investigation, along with our law enforcement partners, worked tenaciously to track down a sophisticated, tech-savvy criminal, Daniel Rigmaiden, who had complete disregard and disrespect for the damage he inflicted on innocent victims and the American taxpayers,” said Dawn Mertz, Special Agent in Charge of the Phoenix Field Office of Internal Revenue Service-Criminal Investigation.
“Individuals who participate in income tax fraud and identity theft of this magnitude should fully expect the FBI and its law enforcement partners to utilize all available resources to ensure they are brought to justice,” said Douglas G. Price, Special Agent in Charge of the Phoenix Field Division of the Federal Bureau of Investigation.
“The successful prosecution in this complex case shows the commitment of the Postal Inspection Service to protect the public from criminal activity,” said Pete Zegarac, Inspector in Charge for the Phoenix Division of the Postal Inspection Service. “The Postal Inspection Service is proud to have partnered with the Department of Justice and fellow law enforcement agencies in this investigation.”
The investigation of Rigmaiden commenced in the fall of 2007 after the IRS began to detect a significant number of possibly related fraudulent tax returns. At that time, Rigmaiden’s identity and involvement were unknown. As a result, the investigation team referred to him as “The Hacker.” An undercover investigation ultimately led to his arrest and execution of search warrants in Northern California in August 2008. The searches revealed significant evidence related to a sophisticated scheme to obtain $5.2 million in tax refunds in the names of innocent third parties and deceased individuals. Rigmaiden ultimately caused the payment of approximately $1,904,321 in fraudulent refunds into accounts and debit cards controlled by him and his co-conspirators, as well as accounts controlled by undercover agents. Up until Rigmaiden’s arrest and identification through fingerprint analysis, his true identity was unknown to the investigation team. Through the team’s efforts, it was determined Rigmaiden had anonymously operated through the use of third-party computers throughout the United States; was involved in acquiring identity information of deceased and living individuals, including their Social Security numbers; and was using that information to conduct a complex electronic bulk tax filing scheme.
The investigation in this case was conducted by Internal Revenue Service-Criminal Investigation, Federal Bureau of Investigation, and U.S. Postal Inspection Service, with assistance from the Santa Clara, California Police Department; Secret Service; and Bureau of Alcohol, Tobacco, Firearms, and Explosives. The prosecution was handled by Frederick A. Battista, Peter S. Sexton, and James R. Knapp, Assistant U.S. Attorneys, District of Arizona, Phoenix.