Man defrauds the IRS more than $1.5 million

SAN DIEGO (CNS) – A Glendale man Thursday admitted in a San Diego federal court to defrauding the Internal Revenue Service out of more than $1.5 million by filing false tax returns in the names of identity theft victims.

The plea by Arthur Grigorian, 33, was the 27th conviction obtained by prosecutors since charges were filed in four related cases a year ago.

Grigorian, the lead defendant in one indictment, admitted using people’s stolen personal information to obtain bogus returns from the U.S. Treasury.

Grigorian and his conspirators falsely claimed refunds in the names of the victims in a number of ways, all of which involved some form of falsified income and withholdings, according to prosecutors.

Most commonly, the perpetrators claimed that the victims — many of whom were elderly and had not filed federal income-tax returns in years — had made tens of thousands of dollars in gambling winnings before losing nearly the identical amount.

The so-called losses effectively canceled out the fabricated winnings, thus entitling the conspirators to a refund for the amount allegedly withheld on the initial winnings. As part of the scheme, Grigorian and his fellow conspirators directed the IRS to send the ill-gotten refunds to postal addresses or bank accounts under their control.

They often would circulate the money through several other accounts before withdrawing it and distributing the money among the group, according to the U.S. Attorney’s Office in San Diego.

Grigorian conceded that he stole the identities of people to use on the fraudulent tax returns, provided this personal information to conspirators, obtained fraudulent identification documents in the names of the identity-theft victims, facilitated the receipt of the ill-gotten funds and enforced discipline on others related to the conspiracy.

In all, Grigorian admitted to participating in the filing of false tax returns in the names of hundreds of people.

He faces a maximum potential sentence of five years in prison and also is required by the terms of his plea agreement to make full restitution to the IRS for the losses caused by his criminal conduct, an amount totaling nearly $1.5 million.

The four related cases charged the alleged perpetrators with tax-fraud conspiracies and several schemes to defraud American banks. In all, about 60 defendants have been charged. Another 28 remain international fugitives, prosecutors said.