A California tax preparer and bookkeeper has pleaded guilty to using the stolen identities of relatives and former clients to file fraudulent tax returns with the Internal Revenue Service.

Imelda Sanchez, 40, pleaded guilty on Monday to one count of making false claims against the government and one count of making false statements on a loan application. She admitted to orchestrating a tax scheme involving stolen identities, along with a loan fraud scheme in which she submitted false income tax returns that overstated her income in order to obtain a $1.6 million loan.

Sanchez admitted in the plea agreement to engaging in a scheme to submit false tax returns and get tax refunds using the names and Social Security numbers of relatives and former clients without their authorization.

As part of the scheme, Sanchez prepared a false 2005 federal income tax return in the name of an unidentified victim falsely claiming a $3,695 tax refund, according to prosecutors.  The refund was based on a false Form W-2 claiming $12,831 in wages and fraudulent tax credits claiming two dependent children.

In addition, Sanchez pleaded guilty to making false statements to Santa Lucia Bank by submitting false personal income tax returns in application for a $1,640,000 loan.

Sanchez faces up to 35 years in prison and a fine of $1.25 million when she is sentenced in May.

The investigation was conducted by IRS Criminal Investigation and the FBI, in conjunction with the U.S. Attorney’s Office for the Central District of California.