A tax preparer and bookkeeper in Southern California was sentenced to 36 months in prison for using the stolen identities of her relatives and former clients to file fraudulent tax returns with the Internal Revenue Service.
Imelda Sanchez, 42, was also accused of participating in a loan fraud scheme in which she submitted false income tax returns that overstated her income in an effort to obtain a $1.6 million loan.
Sanchez was sentenced Monday morning by U.S. District Judge Philip S. Gutierrez, who also ordered her to pay restitution of $124,649 to the IRS and restitution of $721,000 to Mission Community Bank (a successor to Santa Lucia Bank) due to the loss associated with her defaulted bank loan.
Sanchez pleaded guilty in February 2013 to one count of making false claims against the government and one count of making false statements on a loan application.
According to documents filed with the court, from 2005 to 2009, while working as a bookkeeper and tax preparer in Santa Maria, Calif., Sanchez devised a scheme to defraud the IRS by using the names and Social Security numbers of relatives and clients to prepare and file fraudulent tax returns claiming refunds of the Earned Income Tax Credit that she deposited into her own bank account.
As part of her scheme, Sanchez created false Forms W-2 and expense schedules, mixed and matched dependent information, and—in order to avoid detection—told the people whose information she was using not to file their own tax returns or not to claim all of their dependents. In total, Sanchez filed 39 fraudulent tax returns for the 2004 to 2008 tax years in which she collected $124,649 in total false refunds.
In 2007, prosecutors said Sanchez also used her accounting skills to create false personal income tax returns that dramatically overstated her income—claiming she earned four to five times as much money as she claimed on the tax returns she filed with the IRS—in order to obtain a $1,640,000 construction loan from Santa Lucia Bank.
According to court documents, two years later, Sanchez submitted more fraudulent tax returns in order to refinance the same loan. Ultimately, Santa Lucia Bank lost $721,000 as a result of Sanchez’s fraud.
Sanchez plans to surrender to authorities in September to begin serving her prison sentence.
The investigation was conducted by IRS Criminal Investigation and the Federal Bureau of Investigation, in conjunction with the U.S. Attorney’s Office for the Central District of California.