1 f d states district q4 - frankly incftpcontent2.worldnow.com/kxxv/docs/irsaffidavit.pdf ·...

AO 91 (Rev. 1 / II Criminal Complaint F Ii E D UNITED STATES DISTRICT Q4

PM 2 forthe 14

Western District of Texas ESTEE N DI TRtc T OUR T

$

United States of America )

) CaseNo.

ALBERT POWELL (1) PARIS STEPHENS (2) )

RONNIE COLE (3) )

Def'ndant()

CRIMINAL COMPLAINT

I, the complainant in this case, state that the following is true to the best of my knowledge and belief On or about the date(s) of January 2011 thru December 2013 in the county of

Western District of Texas

Code Section

18 U.S.C. § 287 18 U.S.C. § 371 18 U.S.C. § 1028 18 U.S.C. § 1028A 18 U.S.C. § 1343 18 U.S.C. § 1349 26 U.S.C. § 7206

the defendant(s) violated:

Trav and_elsewhere in the

OtiLnse Description

False Claim Against the United States Conspiracy Fraud in Connection with Identification Documents Aggravated Identity Theft Wire Fraud Attempt/Conspiracy to Commit Wire Fraud Fraud and False Statements in Tax Matters

This criminal complaint is based on these facts:

See attached Affidavit.

Ef Continued on the attached sheet.

Sworn to before inc and signed in my presence.

Date:

City and state: Austin, Texas

/ (omplaina signature

DALLAS DOBBS,_Speci Agent, IRS-C Printed name and title

Case 1:14-mj-00129-AWA Document 1 Filed 03/18/14 of 27

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS

AUSTIN DIVISION

UNITED STATES OF AMERICA, § §

Plaintiff. § §

v. § § CRIMINAL NO

ALBERT POWELL, § PARIS STEPHENS, § RONNIE COLE, §

§ Defendants. §

FILED

2114H4R18 P112:I

CLE .i DISTRICT COURT iESTEcN OISTRICT or TEXAS

i.4 rn-

AFFIDAVIT IN SUPPORT OF CRIMINAL COMPLAINT

I, Dallas Dobbs, being duly sworn, depose and state as follows:

1. I have been employed as a Special Agent of the Internal Revenue

Service, Criminal Investigation (IRS-Cl) since January 2010. I am currently assigned to

IRS-Cl's San Antonio Field Office, Austin, Texas post of duty. While employed by IRS-

CI, I have investigated federal criminal violations of the Internal Revenue Code, and

related violations of Titles 18, 26, and 31 of the United States Code, including wire and

mail fraud, false claims, money laundering, identity theft, and unlawful structuring of

financial transactions. As a Federal Agent, I am authorized to investigate violations of

laws of the United States and to execute warrants issued under the authority of the

United States. I have participated in the execution of numerous search warrants for

documents and other evidence in cases involving tax and financial crimes. I am

licensed as a Certified Public Accountant in the State of Idaho and hold a bachelor's

and master's degree in accounting from Boise State University in Boise, Idaho.

AFFIDAVIT Page 1


2. This affidavit is submitted in support of a criminal complaint against

ALBERT POWELL, PARIS STEPHENS, and RONNIE COLE, all of Killeen, Texas, for

violations of Title 18, United States Code, Sections 287 (False Claim Against the United

States), 371 (Conspiracy), 1028 (Fraud in Connection with Identification Documents),

1028A (Aggravated Identity Theft), 1343 (Wire Fraud), 1349 (Attempt/Conspiracy to

Commit Wire Fraud), and Title 26, United States Code, Section 7206 (Fraud and False

Statements in Tax Matters).

3. This affidavit is based on my personal knowledge as well as reports made

by other IRS-Cl agents and law enforcement officers. Because this affidavit is being

submitted for the limited purpose of establishing probable cause for the issuance of the

complaint, it does not contain every fact known to me or other IRS-Cl agents.

THE CONSPIRACY AND SCHEME

4. Beginning at least as early as January 2011, the Defendants, ALBERT

POWELL, PARIS STEPHENS, RONNIE COLE, and others known and unknown to me,

participated in a Stolen Identity Refund Fraud (SIRF) scheme involving the theft of the

personal information of unknowing individuals and the filing of false and fraudulent

individual income tax returns with the IRS claiming tax refunds in the names of the

identity theft victims. In total, the investigation has established that the Defendants

caused more than $1.3 million in stolen identity tax refund claims to be submitted to the

IRS, resulting in the issuance by the IRS of more than $490,000 in refunds for tax years

2010 through 2012.

5. It was the purpose and object of the conspiracy and scheme for the

AFFIDAVIT Page 2


Defendants and others to obtain cash from IRS tax refund checks and direct deposits

that were generated through the preparation and filing of materially false and fraudulent

individual income tax returns with the IRS, and to use the ill-gotten proceeds for their

own use and benefit.

MANNER AND MEANS

6. It was part of the conspiracy and scheme that the Defendants and their

associates obtained personal identification information (P11), including names,

addresses, and social security numbers, of various persons. In many cases, the P11

was stolen; in other cases, P11 was provided to the Defendants knowingly and

voluntarily, but misused by the Defendants for purposes not authorized by the persons

concerned.


associates filed and caused to be filed with the IRS false and fraudulent U.S. Individual

Income Tax Returns, using the P11 of others without their knowledge or consent and

seeking income tax refunds to which the Defendants and their associates were not

entitled. The objective was to generate fraudulently obtained tax refunds by direct

deposit from the U.S. Department of the Treasury ("Treasury") into accounts used and

maintained by the Defendants and their associates, or to obtain tax refund checks

issued by Treasury. All of the tax returns were filed electronically through the IRS

Austin Service Center, Austin, Texas, and/or the IRS Kansas City Service Center,

Kansas City, Missouri.


associates would open, maintain, and/or use bank accounts controlled by the

AFFIDAVIT Page 3


Defendants and others for the purpose of depositing the proceeds from the tax refund

direct deposits and/or tax refund checks. The Defendants would withdraw the proceeds

for their own personal use and benefit, and, in some instances, provide others with a

portion of those proceeds. Occasionally, the Defendants and others would cash tax

refund checks in lieu of depositing them into bank accounts.


associates directed tax refund checks to various addresses within the Western District

of Texas that were controlled by the Defendants and their associates.

10. The Defendants and/or others would fill out each tax return using Turbo

Tax; falsely and fraudulently claim wages, dependents, deductions, and credits,

including false education expenses, earned income credit, child tax credits, and/or

education credits, on the tax return; submit the tax return to the IRS electronically

through Turbo Tax, which claimed a tax refund; and cause a tax refund to be issued by

the IRS.

11. False and fraudulent tax return information that the Defendants filed and

caused to be filed electronically through Turbo Tax was transmitted from the Western

District of Texas to Turbo Tax's network center in Mountain View, California, in the

Northern District of California. The tax return information was then transmitted from the

Turbo Tax facilities in California to the IRS transmission processing center in Memphis,

Tennessee, then to the designated IRS Service Center serving the designated

taxpayer's location for storage and final processing. The tax returns filed and caused to

be filed by the Defendants in this case were ultimately transmitted to and processed by

the IRS Austin Service Center (Austin, TX) and the IRS Kansas City Service Center

AFFIDAVIT Page 4


(Kansas City, MO).

12. The Defendants listed common addresses associated with the

Defendants' actual residences on the tax returns that were submitted using other

persons' P11. Through the use of common addresses, the Defendants made it possible

to receive tax refunds from the IRS even when the bank or debit card company

designated on. the tax returns had rejected direct deposits of the tax refund. Several

U.S. Treasury checks were issued by the IRS and sent to the addresses that were listed

on the false tax returns after the payment had previously been rejected by the originally

designated financial institution. Some of the common addresses used are as follows:

a. 822 James Avenue, Freeport, Illinois;

b. 1312 W. Jasper, Apt. A (1A, 2A, 3A & 4A), Killeen, Texas; (COLE's

previous residence)

c. 1117 N. 8th Street, #7, Killeen, Texas (COLE's previous residence)

d. 4412 Lonesome Dove Dr., Killeen, Texas (POWELL and

STEPHENS' residence)

e. 2700 Vernice Loop Apt. A, Killeen, Texas (POWELL and

STEPHENS' previous residence)

f. 1906 Robert E. Lee Dr., Killeen, Texas (residence of a former co-

worker of STEPHENS')

g. 802 Sissom Apt. 4, Killeen, Texas (residence of a relative of

POWELL)

13. Each tax return electronically filed by the Defendants was associated with

an Internet protocol (IP) address from which it originated. The Defendants filed and

AFFIDAVIT Page 5


caused to be filed multiple fraudulent 2012 tax returns using IP address

173.173.10.251, and filed multiple 2011 tax returns using IP addresses 24.162.151.119

and 24.116.24.165. Tax returns were also filed using other IP addresses including IP

Address 184.6.176.224.

a. Subscriber information from Time Warner Cable for the IP address

of 173.173.10.251 indicated that the subscriber was STEPHENS at her and POWELL's

residence at 4412 Lonesome Dove Dr., Killeen, Texas ('IP Address #1").

b. Subscriber information for IP address 24.116.24.165 ("IP Address

#2") was not available; however, investigation indicates that STEPHENS utilized (P

Address #2 to conduct financial transactions and to submit tax returns while she was

living in Odessa, Texas during the 2012 tax filing season (2011 tax year). STEPHENS

lived in Odessa, Texas while she worked at Haliburton Energy Company as a truck

driver.

c. Subscriber information for IP address 24.162.151.119 ("IP Address

#3") was not available; however, investigation indicates that COLE and POWELL used

this IP address to submit tax returns to the IRS during the 2012 filing season (2011 tax

year) while they lived together in an apartment on Vernice Loop in Killeen, Texas.

d. Subscriber information for IP address 184.6.176.224 ("IP Address

#4") was not received; however, information obtained during the investigation indicates

that RONNIE COLE submitted multiple fraudulent tax returns through this (P address

while he was living at 1117 N. 8th Street Apartment # 7, Killeen, Texas.

14. The defendants used household desktop and laptop computers to access

Turbo Tax through which they submitted fraudulent tax returns to the IRS. On March 8,

AFFIDAVIT Page 6


2013, during the execution of a federal search warrant conducted at STEPHENS and

POWELL's residence at 4412 Lonesome Dove Dr., Killeen, Texas; several computers

were observed that appeared to be in use by the occupants. A large iMAC desktop

computer (hereinafter referred to as "the IMAC") was turned on and opened to a Turbo

Tax account in someone else's name. A HP Pavillion G4 Laptop with pictures of

butterflies on the outer casing was observed on a TV stand in the family room that was

turned on and showed a locked screen with PARIS STEPHENS as the username/user

(hereinafter referred to as "STEPHENS Laptop"). A Mini HP Laptop was observed in a

laptop bag underneath the desk that held the the iMAC. The pocket of the laptop bag

contained several 3x5 index cards with handwritten notes listing names, dates of birth,

and social security numbers of various individuals. Once turned on, the HP Mini Laptop

displayed the user/username as ALBERT POWELL (hereinafter referred to as

"POWELL Laptop"). These computers were forensically examined after the search

warrant. The forensic analysis showed that the computers had been used to access

various Turbo Tax accounts from which stolen identity refund fraud claims had been

submitted to the IRS. The tax returns had been submitted from various IP Addresses

including IP addresses 1, 2, and 3. Various handwritten notes were seized tracking the

identities that had been used to submit false claims and where the tax refunds would be

deposited.

15. As described in Paragraph 13d, the following information was uncovered

during the investigation that provides probable cause to believe that STEPHENS

transmitted fraudulent tax returns through IP Address #2. On or about January 9, 2012,

STEPHENS opened a checking account at a Wells Fargo Bank branch in Odessa,

AFFIDAVIT Page 7


Texas. She opened the account by showing her Texas Driver License to verify her

identity. A picture from this driver license was shown to multiple witnesses who

confirmed it was PARIS STEPHENS. A Wells Fargo IP Information Report, which

shows the IP addresses through which a customer accessed their account electronically

or conducted financial transactions electronically, revealed that STEPHENS transferred

money to her Wells Fargo Checking Account through IP Address #2 on January 17,

2012. STEPHENS' USAA bank account activity shows that STEPHENS conducted

various financial transactions with her debit card in Odessa, Texas from December 28,

2011 through January 23, 2012. Turbo Tax evidence shows that several identity theft

tax returns were filed from IP Address #2 from January 5, 2012 through January 22,

2012. Forensic examination of computer evidence seized from 4412 Lonesome Dove

Dr., Killeen, Texas linked several 2011 tax returns sent from IP Address #2 to the

STEPHENS laptop.

16. Investigation revealed that POWELL and COLE transmitted, or caused to

be transmitted, false tax returns through IP Address #3 while living in an apartment on

Vernice Loop in Killeen, Texas. During a voluntary interview of COLE by me on May

16, 2013 ("the COLE Interview"), RONNIE COLE said that he and POWELL submitted

tax returns from the same location when they lived together in an apartment on Vernice

Loop in Killeen, Texas. COLE claimed that he did not file tax returns from the same

location as POWELL except during the time they lived together on Vernice Loop.

Multiple 2011 tax returns submitted from IP Address #3 were identified that COLE

admitted to preparing. Forensic examination of computer evidence indicated that

several tax returns from IP Address #3 were linked to the POWELL Laptop that was

AFFIDAVIT Page 8


seized from STEPHENS' and POWELL's residence on March 8. 2013. Additionally,

several tax returns submitted from IP Address #3 listed an address of 2700 Vernice

Loop Apt. A., Killeen, Texas 76549.

17. In addition to computers, potential sources for the stolen identities used on

the false tax returns were seized during the search warrant on March 8, 2013.

Hundreds of original employment applications and W-4 forms with P11 were identified

and seized from POWELL and STEPHENS' residence. The majority of the employment

applications and W-4 Forms appeared to have been taken from Wendy's locations in

Chicago, IL and were dated in 2006 or 2007, but some were taken from the Killeen,

Texas, area, which were dated in 2012. During the investigation, it was discovered that

POWELL previously worked as an employee for Wendy's in the Chicago, Illinois area

and eventually attained the position of manager. POWELL has never worked at a

Wendy's location in Killeen, Texas but has two associates in Killeen, Texas that did

work there. After the search warrant, the investigation uncovered that several identities

included on the employment applications and W-4 forms were linked to false tax returns

that appear to have been filed by ALBERT POWELL and/or PARIS STEPHENS. The

fraudulent tax refunds that were generated due to these false claims could also be

traced to bank accounts controlled by ALBERT POWELL and/or PARIS STEPHENS.

VICTIMS

18. On or about August 1,2013, I interviewed LH, a victim of the scheme who

resides in Chicago, Illinois. LH is 25 years old and lives at home with her mother and

does not have any dependents of her own. LH attended high school but didn't graduate

AFFIDAVIT Page 9


and is working on obtaining her GED. LH worked part time as a cashier in 2012 but did

not have a job in 2009, 2010, or 2011. LH has never filed a tax return independently

and has always been claimed as a dependent on her mother's tax returns. LH is aware

that her mother had issues claiming her on tax returns in the past and was told by

various return preparers that LH had already been claimed on another tax return.

19. For both 2011 and 2012 tax years, false Forms 1040A were sent in the

name of LH from the same Turbo Tax account. Both tax returns claimed between

$13,000.00 and $14,500.00 in false income listing the occupation of LH as a Tutor. The

tax returns claimed two false dependents listing the individuals as LH's brother and

sister and claimed college expenses. These false items caused education credits,

earned income credit, and child tax credits to generate refunds. The 2011 and 2012

false tax returns claimed fraudulent tax refunds in the amounts of $6,020.00 and

$5,236.00 respectively. The IRS issued and lost $4,002.00 due to these false claims.

a. 2011 tax refund, $6,020.00 claimed I $4,002.00 issued by IRS: A

total of $6,020.00 was claimed for the 2011 tax refund in the name of LH but the IRS

issued a total refund of $4,002.00. The full amount of $4,002.00 was direct deposited

into Fort Hood National Bank Account ending in 4456 in the name of ALBERT

POWELL. POWELL opened the account on January 3, 2011. POWELL provided his

Texas Driver License as his primary identification when he opened the bank account.

b. 2012 tax refund, $5,236 claimed: A total of $5,236.00 in tax refund

was claimed in the name of LH for 2012. The full amount of the tax refund was

designated to be deposited into a bank account ending in 9128 in the name of PARIS

STEPHENS at Mid Missouri Credit Union. STEPHENS opened this bank account on

AFFIDAVIT Page 10


March 11, 2008. Mid Missouri Credit Union provided correspondence regarding a

change of address that appears to match STEPHENS' handwriting. Other tax refunds

issued to victims of identity theft were deposited through this same Mid Missouri Credit

Union bank account opened by STEPHENS.

20. The false 2011 Form 1040A in the name of LH was sent from IP Address

#2, while the false 2012 Form 1040A was sent from IP Address #1. A forensic

examination of the Stephens Laptop revealed that the laptop had been used to access

the Turbo Tax account that submitted the 2011 and 2012 false tax returns to the IRS in

the name of LH. On March 8, 2013 handwritten notes were seized from POWELL and

STEPHENS' residence which appear to match the handwriting on bank withdrawal slips

filled out by STEPHENS. The notes appear to be tracking the 2011 tax refund in the

name of LH. Additionally, a Wendy's Employment Application was seized listing LH as

the applicant on the form. LH reviewed the document and confirmed that she had filled

out the application and applied at a Wendy's location in Chicago, but never got the job.

LH confirmed that the information contained on the 2011 and 2012 tax returns

submitted in her name was false and stated that she did not authorize these tax returns

to be filed in her name. LH said that she doesn't know POWELL, STEPHENS, or

COLE.

21. On or about, July 31, 2013, I interviewed AW, a victim of the scheme who

resides in Sauk Village, Illinois. AW is a 24 year old college student who lives with her

mother. She recently graduated from college where she earned a Bachelor's degree

and has plans on earning a Master's degree in the future. AW and her mother, SW,

worked at Wendy's Fast Food Restaurants in the Chicago, Illinois area. AW filed a tax

AFFIDAVIT Page 11


return for the first time in 2012. Prior to that, she didn't earn enough money to file

independently and would have been claimed as a dependent by her mother. AW's

mother, SW, said that she has not received her tax refund since 2006 or 2007. After the

interview, it was discovered that SW was claimed as a dependent on false tax returns

submitted that tie to the scheme in 2010, 2011, and 2012. The details invoMng SW are

not included in this affidavit.

22. For both 2011 and 2012 tax years, false Forms 1040A were sent to the

IRS in the name of AW, listing an address on the tax returns of 1906 Robert E. Lee Dr.,

Killeen, TX. AW has never been to the state of Texas and has no connection to that

address. For both 2011 and 2012 tax years, false Forms I 040A were sent in the name

of AW from the same Turbo Tax account. Both tax returns claimed between $13,000.00

and $14,500.00 in false income listing AW's occupation as a Model. The tax returns

claimed one false dependent listing the relationship as brother and claimed college

expenses. These false items caused education credits, earned income credit, and child

tax credits to generate refunds. The 2011 and 2012 false tax returns claimed fraudulent

tax refunds in the amounts of $4,058.00 and $3,169.00 respectively. The IRS issued

and lost a total $7,227.00 in tax refund money due to these false claims.

a. 2011 Refund, $4,058.00 claimed / issued: The 2011 tax refund of

$4,058.00 was designated to be deposited onto a prepaid Turbo Tax debit card to be

sent to 1906 Robert E. Lee, Killeen, Texas. Turbo Tax flagged the account for fraud

and rejected the payment. IRS then issued the $4,058.00 refund on a physical treasury

check in the name of AW and sent the check to 1906 Robert E. Lee, Killeen, TX.

Sandra W. (no relation to AW) resided at 1906 Robert E. Lee, Killeen, TX during this

AFFIDAVIT Page 12


time frame. Sandra W. previously worked with STEPHENS at Killeen Independent

School District as a bus driver. Sandra W. said that STEPHENS paid her money to

receive mail from the IRS and Turbo Tax. Sandra W. provided mail to both STEPHENS

and POWELL but always coordinated and dealt with STEPHENS. Sandra W. provided

mail to STEPHENS and would receive $100 from POWELL and/or STEPHENS for each

piece of mail from the IRS or Turbo Tax that she received in the mail for various

individuals. Sandra W. specifically remembers meeting with POWELL on one occasion

to provide him with 2 envelopes addressed to different individuals, which she believed

contained Turbo Tax debit cards. POWELL gave her $200.00 in exchange for the

envelopes. The $4,058.00 forged treasury check in the name of AW was deposited

through the ATM on March 14, 2012 into ALBERT POWELL's checking account at

USAA ending in 1735. The funds from the refund along with other fraudulent tax refund

money was withdrawn through two debit card cash advances both in the amount of

$3,000.00 on March 14, 2012 and March 16, 2012. Several lower dollar debit

purchases were also executed during this time frame expending the funds. ALBERT

POWELL opened the account at USAA through an online application. Multiple checks

deposited appear to match the signature of POWELL from other bank account

documents that he signed when his identity was confirmed through observation of his

personal identification.

b. 2012 Refund, $3,169.00 claimed / issued: The 2012 tax refund of

$3,169.00 was direct-deposited into PARIS STEPHENS' checking account ending in

8562 at Bank of America. The actual amount deposited was $3,106.55 after fees were

deducted. STEPHENS opened the account on December 15, 2008 at a bank branch in

AFFIDAVIT Page 13


Killeen, Texas. Her identity was confirmed through the bank's observation of her Texas

Driver License. The proceeds of the refund were primarily withdrawn through the ATM

and transferred to other bank accounts controlled by STEPHENS.

23. AW was shown a 19-person photo lineup that included images of

POWELL, STEPHENS, and several suspected associates, and stated she did not know

any of the persons who were depicted. She didn't authorize anyone to use her personal

information to file a tax return. The 2011 false tax return was submitted from IP

Address #2 while the 2012 false tax return was submitted from IP Address #1. The

same Turbo Tax account was used to submit both tax returns. Forensic evidence

pulled from the STEPHENS laptop with information produced by Turbo Tax provides

evidence that the laptop was used to access this Turbo Tax account which submitted

the two false tax returns.

24. On or about July 30, 2013, I interviewed KH, a suspected victim of the

scheme who resides in Freeport, Illinois. KH lives with his wife and 3 young children

and collects social security disability. He did not earn any money in 2010 or 2011. KH

stated he learned that someone had filed a tax return in his name when he attempted to

file his 2012 federal income tax return to report income he had earned as a packer at a

local factory. KH and his wife said that they had still not received their tax refund that

they were due which caused a significant financial strain on their family.


name of KH. Both tax returns claimed between $14,000.00 and $16,500.00 in false

income listing the occupation of KH as a Barber. The tax returns claimed one false

dependent listing the individual as KH's brother and claimed college expenses. These

AFFIDAVIT Page 14


false items caused various tax credits to generate refunds. KH confirmed that the

information included on the tax returns was false and said that he did not have

knowledge of nor authorize these tax returns to be filed in his name. These false tax

returns caused fraudulent tax refunds to be processed and sent by the IRS. The 2011

tax refund of $4,094.00 was directed to be split as follows: $3,000.00 direct-deposited

into a Chase checking account ending in 8860 in the name of David R.,1 and $1,094.00

direct-deposited onto a Turbo Tax prepaid debit card that was to be sent to 822 James

Ave., Freeport, IL, the address listed on the tax return. KH never lived at 822 James

Ave., Freeport, IL and does not know anybody that has lived there.

a. 2011 tax refund, $3,000 portion: $3,000.00 was direct deposited

into David R's Chase bank account ending in 8860, which David R. opened on October

26, 2009 at a bank branch in Temple, Texas. On or about May 6, 2013, I interviewed

David R., who said that he worked with POWELL at Pactiv Corp. in Temple, Texas.

POWELL paid David R. to have tax refunds deposited through his account. In the

beginning, POWELL would notify David R. when a refund was due to be deposited and

would accompany him to the bank to have the funds withdrawn. David R. would provide

all of the funds withdrawn to POWELL. David R. would usually withdraw cash but

remembers converting funds into a cashier's check on one occasion which he gave to

POWELL. After a few withdrawals, POWELL would meet David R. at a pre-determined

location to collect the cash. In February and March 2012, David R. received

approximately 9 tax refunds amounting to approximately $31,400.00 through the

checking account ending in 8860. David R. said that POWELL paid him approximately

$3,500.00 in increments of $500.00 to $900.00 for allowing POWELL to have the tax

1

I know the full name of David R., but am not including it here to protect his privacy.

AFFIDAVIT Page 15


refunds deposited into his account and for making the withdrawals. David R. stated that

he was assured by POWELL that everything was legal. The $3,000.00 portion of KH's

tax refund was deposited into chase checking account ending in 8860 on February 1,

2012. This same day, 4 other tax refunds were direct deposited into the account taking

the cumulative total of tax refunds deposited on February 1, 2012 to $19,150.00. David

R. said that he was instructed by POWELL to conduct a withdrawal. POWELL travelled

with David R. to a Chase bank branch in Temple Texas where David R. conducted the

withdrawal for $ 18,500.00 in cash. David R. gave the cash to POWELL.

b. 2011 tax refund, $1,094 portion of refund: The debit card used was

closed by Turbo Tax due to potential fraud which caused the IRS tax refund payment to

be rejected. Since the payment rejected, IRS re-issued the payment of $1,094.00 in the

form of a physical check which was sent to the address of 822 James Ave., Freeport, IL.

This check was then deposited by ATM into a USAA bank account owned by Chris L.,

who is ALBERT POWELL's cousin. Chris L. said that he withdrew the money and gave

it to Powell. The address of 822 James Ave., Freeport, IL appears to be connected to a

person named Charles P. In addition to receiving this physical check, Charles P

appears to have received a direct-deposit of a potentially fraudulent refund connected to

the scheme through his bank account. Charles P opened the bank account in his name

at Cornerstone Federal Credit Union in Freeport, IL on or about November 12, 2011 and

listed his personal address as 822 James Ave., Freeport, IL.

c. 2012 Refund, $3.169.00: The full amount of the 2012 tax refund

claimed in the name of KH was designated to be direct-deposited into Fort Hood

National Bank checking account ending in 4456 in the name of ALBERT POWELL, but

AFFIDAVIT Page 16


the tax refund was stopped by the IRS before it could be effectuated. POWELL opened

the account on January 3, 2011. POWELL provided his Texas Driver License as his

primary identification when he opened the bank account. This same photo from his

Texas Driver License was shown to multiple associates and witnesses, including David

R., who all confirmed that the individual in the photo was in fact ALBERT POWELL.

26. The false 2011 tax return for KH was submitted from lP Address #3; the

false 2012 tax return for KH was submitted from IP Address #1. The same Turbo Tax

account was used to submit both tax returns. Forensic evidence obtained from the

Powell Laptop indicates that the laptop was used to access the Turbo Tax account

which submitted the two false tax returns for KH.

27. On or about September 4, 2013, I interviewed AH of Freeport, IL by

telephone. AH is a 25 year old female who recently began taking community college

courses in 2013 and works full time. AH suspected her identity had been stolen when

she attempted to file her 2011 tax return electronically in February 2012, but couldn't

because her social security number had already been used on another tax return.


name of AH. Both tax returns claimed between approximately $15,500.00 and

$15,800.00 in false income, listing the occupation of AH as Homemaker. The tax

returns claimed one false dependent listing the individual as AH's brother and claimed

false college expenses in 2011. These false items caused various tax credits to

generate refunds.

29. The 2011 false tax return caused a fraudulent tax refund in the amount of

$4,094 to be processed and sent by the IRS. The 2012 false tax return sent in the

AFFIDAVIT Page 17


name of AH was rejected by the IRS and consequently, a tax refund did not generate.

Thus, a combined total of $7,263.00 was falsely claimed in the name of AH with a total

of $4,094.00 that was issued and lost by the IRS. The subjects designated the 2011 tax

refund in the name of AH to be deposited in the same way they had as victim KH, which

is described above, with $3,000.00 direct-deposited into Chase checking account

ending in 8860 in the name of David R., and $1,094.00 direct-deposited onto a Turbo

Tax prepaid debit card that was to be sent to 822 James Ave., Freeport, IL, the address

listed on the tax return.

a. 2011 Refund, $3000.00 portion: The $3,000.00 portion of AH's tax

refund was deposited into chase checking account ending in 8860 on February 1, 2012.

This same day, 4 other tax refunds were direct deposited into the account taking the

cumulative total of tax refunds deposited on February 1, 2012 to $19,150.00. David R.

said that he was instructed by POWELL to conduct a withdrawal. POWELL travelled

with David R. to a Chase bank branch in Temple Texas where David R. conducted the

withdrawal for $ 18,500.00 in cash. David R. gave the cash to POWELL.

b. 2011 Refund, $1,094.00 portion: $1,094.00 was sent in the form of

a treasury check to 822 James Ave., Freeport, IL. AH never lived at this address and

doesn't know anyone that lives there. The check was issued after Turbo Tax rejected

the payment of the tax refund on the originally designated Turbo Tax debit card. This

forged check was then deposited into RONNIE COLE's USAA bank account ending in

0208 with USAA. COLE confirmed that he had conducted the purchases that expended

the money derived from the tax refund in the name of AH. However, he said that he did

not know whether the identity of AH had been stolen.

AFFIDAVIT Page 18


c. 2012 Refund, $3169.00: The 2012 tax return designated the

claimed refund of $3,169.00 to be deposited onto a Turbo Tax prepaid debit card that

was to be sent to 802 Sissom Rd. Apt. 4, Killeen, TX where ALBERT POWELL's cousin,

Chris L., resides. AH has never lived at this address and does not know anyone

associated with this address.

30. AH said that she did not authorize the 2011 and 2012 tax returns claiming

income as a homemaker to be filed in her name and confirmed that the information on

the returns was false. The 2011 false tax return was sent from IP Address #3, while the

2012 rejected false tax return was sent from IP Address #1. Forensic analysis of the

POWELL laptop showed that the laptop was used to access the Turbo Tax account that

submitted the false tax return in the name of AH. The same Turbo Tax account that

was used to submit the false tax returns in the name of victim KH, described above, was

used to submit the false tax returns in the name of AH.

31. STEPHENS and POWELL both coordinated with and directed associates

to collect and provide them with P11 for the purpose of filing false tax returns. POWELL

and STEPHENS used their connections they had through their employment and

personal relationships to obtain stolen identities and/or to effectively collect the

fraudulent tax refund money. POWELL and STEPHENS used several bank accounts

through multiple financial institutions, effectively spreading out the deposits of the

fraudulent tax refunds. Handwritten notes recovered from POWELL and STEPHENS'

residence show extensive tracking of the status of tax refunds noting which bank

account had been used and when the deposit was received. POWELL, STEPHENS,

and associates would generally conduct immediate cash withdrawals of the tax refunds

AFFIDAVIT Page 19


on the same day that the refund cleared the bank. In some instances though, the

money received would be used to fund personal expenses. For example, STEPHENS

received approximately 5 tax refunds cumulating to over $22,000.00 from January 25,

2011 through January 28, 2011 through her bank account ending in 8562, which she

opened on December 15, 2008. A few days later, On January 31, 2011, this money

was used to fund a purchase over $7,000.00 at the Furniture Zone in Killeen, Texas,

and funded a $1 200.00 purchase for American Airline tickets on February 1, 2011.

32. In addition to collecting fraudulent refunds through bank accounts in their

own names and that of associates, evidence suggests that STEPHENS and/or

POWELL opened or caused to be opened a bank account in the name of suspected

identity theft victim AG. On or about July 29, 2013, I interviewed AG of Chicago,

Illinois. AG earns money by doing people's hair. AG does not know POWELL,

STEPHENS, or COLE and didn't recognize anyone included on a 19 person photo

lineup. AG was shown account opening documents and bank statements for Chase

Checking account ending in 0278 and Chase savings account ending in 9819 in the

name of AG opened on March 1, 2011. AG was listed as the sole signer on the bank

account that was opened electronically. AG said that she did not open these bank

accounts and did not authorize anyone to do so in her name. AG has never had access

to these bank accounts and was not aware that they existed.

33. The personal address listed on the account opening documents was 2701

Vernice Loop Apt. A, Killeen, TX 76549, which investigation shows was the previous

personal address for PARIS STEPHENS and/or ALBERT POWELL. The mailing

address for the bank account was later changed to 4412 Lonesome Dove Dr., Killeen,

AFFIDAVIT Page 20


TX 76549, which coincides with when POWELL and STEPHENS moved into their

residence at 4412 Lonesome Dove Dr., Killeen, TX and changed the mailing address for

their personal bank statements in their own names. Chase checking account ending in

0278 in the name of AG was used to conduct an ATM deposit of a forged fraudulent tax

refund in the amount of $5,058.00 in the name of AG with an address listed on the

check of 1906 Robert E. Lee, Killeen, TX., which was where the check was delivered.

As described previously, I interviewed Sandra W. who lived at 1906 Robert E. Lee and

said that she was paid to receive and deliver mail from the IRS and Turbo Tax to

STEPHENS and/or POWELL in exchange for money. Sandra W. specifically

remembered receiving mail in the name of AG which she provided to POWELL or

STEPH ENS.

34. Chase checking account ending in 0278 in the name of AG was also used

to receive two other fraudulent tax refunds in the names of other stolen identities, direct-

deposited into the account on January 26, 2012 and February 1, 2012 in the amounts of

$5,049.63 and $5,071.00 respectively. These tax refunds were issued by the IRS due

to false tax returns that were submitted through IP Address #2. Forensic analysis

revealed that all three of the Turbo Tax accounts from which the false tax returns were

submitted to the IRS were accessed through the STEPHENS Laptop.

35. On March 8, 2013, during the search warrant executed at POWELL and

STEPHENS' residence in Killeen, Texas, a copy of an Illinois State ID card and social

security card in the name of AG were seized. Additionally, paper copies of bank

statements were seized for Chase checking account ending in 0278 in the name of AG

during the search warrant conducted at POWELL and STEPHENS' residence on March

AFFIDAVIT Page 21


8, 2013. The statements list a previous address for POWELL and/or STEPHENS at

2701 Vernice Loop Apt. A, Killeen, TX.

36. During the COLE Interview, COLE claimed that he has never filed a tax

return in someone else's name that they were not aware of. COLE claimed that people

give him other people's personal information and he will file a tax return in their name

but COLE is unaware of whether that person's identity was in fact stolen. COLE also

claimed that he would have tax refunds for other people deposited into his account

because they did not have bank accounts or proper identification in order to cash a

check. COLE claimed that all of the information that he included on tax returns that he

prepared for individuals was either given to him by the taxpayer themselves or by

someone that knew the taxpayer. COLE initially denied knowing anything about any

employment applications. When confronted about lying, COLE admitted to seeing the

Wendy's Employment Applications at POWELL and STEPHENS' residence but claimed

that he never used any of the identities to submit tax returns to the IRS.

37. On or about July 29, 2013, TW, a victim of the scheme who resides in

Chicago, Illinois, was interviewed. TW is on social security disability and lives with her

five year old daughter DW. TW has never had a job and thus, never filed a tax return.

1W said that she did not file a tax return in 2011.

38. A 2011 tax return in the name of TW was submitted to the IRS through IP

Address #3. The tax return claimed that TW earned $16,500.00 as a beautician and

also listed two dependent sisters of BB and SB claiming their relationship as sisters.

This false tax return caused a tax refund of $7,112.00 to be generated by the IRS. The

full amount of the refund was designated to be deposited onto a pre-paid Turbo Tax

AFFIDAVIT Page 22


debit card which was to be sent to the address of 1312 W. Jasper Apt. B, Killeen,

Texas. Turbo Tax rejected payment on the card. IRS then issued the tax refund in the

form of a physical check. A change of address with the IRS was requested in the name

of TW on February 5, 2012 changing the address to 1117 N. 8th Street Apt. # 7, Killeen,

Texas (COLE's residence at the time). The Treasury check in the name of TW was

deposited into COLE's USAA checking account ending in 0208 on June 7, 2012. Some

of these funds were then quickly withdrawn on the same day through a purchase at the

Shell Station for $29.53, an ATM withdrawal for $600.00, and a debit purchase at

Walmart in Killeen, TX for $2,501.80. USAA subsequently froze and closed the

account.

39. During the COLE Interview, COLE said that he opened the USAA bank

account ending in 0208 and believes that he did so over the phone. USAA checking

account ending in 0208 was opened on February 23, 2012 through an online

application. COLE said that all of the purchases made through USAA checking account

ending in 0208 were purchases that he personally transacted. COLE had 3 additional

treasury checks deposited through this account. COLE admitted that either he or

POWELL would conduct the deposits into the account. COLE admitted to personally

signing one of the checks. COLE said that he prepared and filed a 2011 tax return in

the name of TW. COLE claimed to have received TW's information from an individual

named Simone (Last Name Unknown). COLE was asked by Agents to provide further

contact information for Simone LNU but COLE never did so.

40. TW confirmed that the information contained on the 2011 tax return filed in

her name claiming income as a beautician was false. She did not recognize any of the

AFFIDAVIT Page 23


individuals on a 19 person photo lineup that she was shown. This included photos of

COLE, POWELL, and STEPHENS. TW said that she does not know RONNIE COLE

and never gave him authorization to file a tax return on her behalf or to deposit a tax

refund in her name.

41. FC is a 24 year old female who lives in Killeen, Texas. FC currently works

at a fast food restaurant, earns money on the side doing hair, and is working toward

receiving her GED. FC met RONNIE COLE and ALBERT POWELL through social

media. FC said that she personally knew COLE and that he talked about preparing tax

returns. COLE told FC that she could get money back for being self-employed doing

hair and that he could prepare her tax return. COLE took FC to POWELL's personal

residence and sat down at the desktop computer and showed her what she could get

back as a refund based on the income information she gave him. COLE told her that

her refund would be approximately $1,500.00. FC agreed to have a tax return prepared

and submitted by COLE since everything he explained seemed legitimate.

42. A false 2011 Form 1040A was submitted in the name of FC from IP

Address #3. FC was aware that this tax return was submitted but was never provided

with a copy. FC reviewed a copy of the 2011 Form 1040A submitted in her name for

the first time during an interview. FC said that the income reported on the return was

falsely overstated since it was higher than the income estimate she had given him.

COLE initially said that he would only charge her $200 for the preparation of the tax

return. COLE arranged for the tax refund to be deposited onto a pre-paid Turbo Tax

debit card which was to be sent to his personal residence. Turbo Tax denied the

payment and FC was told by COLE that he called the IRS and had arranged for a

AFFIDAVIT Page 24


physical check to be sent to his house. FC was suspicious that COLE would have her

tax refund go to his house. FC filed a change of address with the Post Office changing

her address from COLE's personal residence to her residence. A refund check in the

amount of approximately $4,300.00 in the name of FC arrived at FC's residence. FC

notified COLE that the check had arrived but was confused regarding the amount listed

on the check and why it was so large. COLE took FC to a check cashing store and had

her cash the check. FC cashed the check and gave all of the cash to COLE. COLE

took $3,200.00 for himself. COLE claimed that $3,000.00 was what the IRS paid him to

prepare the tax return and that $200 was his charge. He gave the rest to FC. FC said

that COLE was very forceful during the entire encounter. FC has not seen COLE since

the day she had the check cashed. FC said that she never authorized anyone including

COLE to submit a 2012 tax return in her name. FC said that she has always had proper

identification and never allowed COLE to deposit a tax refund into his bank account.

43. On January 28, 2013, a false 2012 Form 1040A in the name of FC was

submitted from IP Address #4. A query run by IRS shows a total of 7 tax returns for

2012 tax year that were submitted through IP Address #4. One of these tax returns was

submitted in the name of COLE's current wife, Jasmine Bradshaw. COLE'S previous

address of 1312 W. Jasper Apt. IA, Killeen, TX 76549 was listed as the address on the

false 2012 Form 1040A submitted in the name of FC. On February 6, 2013, the 2012

tax refund in the amount $4,117.37 ($4,169.00 refund less fees) in the name of FC was

deposited into Jasmine Bradshaw's (COLE's wife) Chase checking account ending in

6530. Jasmine Bradshaw opened Chase checking account ending in 6530 on

November 1, 2012 at a Chase bank branch in Harker Heights, Texas. Bradshaw's

AFFIDAVIT Page 25


identity was confirmed through observation of her Texas Driver License.

44. During the COLE Interview, COLE admitted to preparing a tax return for

FC. COLE admitted that he submitted the 2012 tax return for Jasmine Bradshaw and

falsified the dependents on this tax return. COLE admitted to submitting a tax return in

the names of the other individuals identified from the IF Address #4 query including FC.

COLE claimed that he had FC's tax refund deposited into his wife, Jasmine Bradshaw's

bank account, because FC lost her identification and had to have her refund go through

COLE. COLE claimed that he had the tax refunds of the other individuals listed on the

IF Address #4 query deposited into either his or Jasmine Bradshaw's bank account

because the individuals did not have proper identification or bank accounts.

CONCLUSION

45. Based on the foregoing, there is probable cause to believe that ALBERT

POWELL, PARIS STEPHENS, and RONNIE COLE have committed the offenses set

forth in the attached Criminal Complaint.

FURTHER AFFIANT SAYETH NAUGHT.

/

I,

/ -

DALLAS DOBBS, Special Agent IRS - Criminal Investigation Austin, Texas

(t Subscribed and sworn before me at Austin, Texas, on this day of

March, 2014.

AFFIDAVIT Page 26
