A former Internal Revenue Service employee received a prison sentence for leading an elaborate conspiracy with her boyfriend to steal taxpayers’ identifying information in order to receive fraudulent tax refunds at a bogus mailing address.
Taylor S. Knight, 33, of Kansas City, Mo., was sentenced Monday by U.S. District Judge Howard F. Sachs to two years in federal prison without parole. The court also ordered Knight to pay $5,000 in restitution to the IRS.
Knight, who pleaded guilty on July 25, worked as an IRS employee at a Kansas City office between March 2009 and January 2012. Knight admitted that she abused her position of trust when she inappropriately accessed the information of three taxpayers as part of a conspiracy to defraud the federal government by using stolen identity information to induce the IRS to issue tax refunds.
She used information from a pair of married taxpayers on Sept. 30, 2011 to submit a bogus online application for three prepaid debit cards. The debit cards were issued and mailed to the residence of the grandmother of Knight’s boyfriend, Michael J. Moore, 28, of Kansas City, Mo. Moore monitored the mail sent to his grandmother’s address and retrieved the three prepaid debit cards. Knight and Moore agreed to use his grandmother’s address rather than use an address associated with Knight in an effort to conceal her role in the scheme. Moore has pleaded guilty to his role in the conspiracy and awaits sentencing.
Knight submitted a 2010 tax return on Oct. 17, 2011, for the same two married victim taxpayers. The IRS approved a $46,572 refund, of which $5,000 was deposited on a debit card that had been obtained by Knight. The IRS attempted to deposit the remaining $41,572 refund on the other debit cards obtained by Knight, but the receiving banks rejected the deposits.
Moore telephoned the IRS on Dec. 7, 2011, and falsely claimed to be one of the taxpayers who had been victimized. He provided the IRS representative with personal identification information for both victims and asked the IRS to send the remaining tax refund to a new address in Independence, Mo. He gave that address because it was his former residence and he knew it was unoccupied.
The victimized taxpayers had filed their own legitimate amended tax returns in August 2011. A $46,734 refund check was sent to the Independence address and was obtained by Moore and Knight. Knight agreed to pay $500 to co-defendant Michael Stalcup, 43, of Farley, Mo., to help her cash the refund check. Knight obtained false identification documents—including Social Security cards, credit cards and driver’s licenses—so they could assume the identity of the victim taxpayers.
Knight and Stalcup attempted to cash the stolen Treasury check at a local convenience store. The clerk said he was concerned about cashing such a large check and he went to his immediate supervisor for guidance. Stalcup told the clerk and his supervisor that, if they would cash the check, they could keep $6,000 of the proceeds. The supervisor decided not to cash the check, but he told them to come back later.
When Knight and Stalcup returned, the owner reported the incident to law enforcement. Police officers arrived about 10 minutes later. When Stalcup saw the police officers he attempted to flee, but was apprehended. Both Knight and Stalcup were arrested. Stalcup has pleaded guilty to his role in the conspiracy and awaits sentencing.
Knight also admitted that she submitted a bogus online application for a prepaid debit card in the name of another victim taxpayer. The debit card was approved and mailed to an address in Oak Grove, Mo., but this debit card was never used. Knight admitted that she submitted this false online application to test whether her scheme to defraud the IRS was viable.
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