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Thief uses identity theft to fund a business

by Neal O'Farrell on November 29th, 2011

In one of the most bizarre and creative identity thefts I’ve come across recently, a Florida car salesman was recently arrested and charged with a multi-million dollar identity theft scheme that helped fund his car business.

The alleged thief had somehow managed to steal the identities of hundreds and perhaps thousands of victims. According to authorities, the Florida man used information stolen from the State Department of Children and Families and Department of Juvenile Justice. How he got that information is unclear, although assistance from insiders in cases like this is not unusual.

Armed with the new identities, the alleged thief then filed more than 1,500 tax returns in the names of his victims, and had the money deposited in a network of bank accounts he had set up. But here’s the twist. Rather than pocket the money like most thieves, instead the suspect used the money to purchase cars which he then sold on his car lot.

Apart from being a very creative way to fund a business and buy stock, it’s also a great way to launder money and make the money look like it legitimately came through car sales. The scheme may have netted the thief more than $5 million, which has yet to be recovered. And once again, the scam was discovered only by the vigilance of a postal worker who reported an unusual amount of IRS-related mail going to the one address.

And it’s not the first time thieves in Florida have exploited huge holes in the tax refund system to make money. A few weeks ago I wrote about Operation Rainmaker, a Florida-wide law enforcement that took down a massive identity theft scam that netter local drug dealers an estimated $130 million by filing bogus tax refunds using stolen identities.

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