A Massena woman has been named in a federal indictment alleging she and another woman filed more than $500,000 in fraudulent tax returns, mostly on behalf of 50 to 60 people living in the Massena area who did not know the returns were fraudulent.
Lacey J. Hollinger, 27, along with Elaine M. Zavala-Charres, 33, Phoenix, Ariz., was charged Wednesday in U.S. District Court, Syracuse, with seven counts of operating a mail fraud scheme to defraud the Internal Revenue Service and two counts of aggravated identity theft. The mail fraud counts carry a sentence of up to 20 years in prison and a fine up to $250,000.
According to the U.S. attorneys office, the pair allegedly operated a scheme to defraud the IRS from January 2012 to May in St. Lawrence County and elsewhere. The scheme involved using personal identification information acquired through fraud to file tax returns with false income levels to generate fraudulent refunds. The scheme involved the submission of more than $500,000 in fraudulent tax returns to the IRS in tax years 2011 and 2012, primarily in New York and Arizona.
According to a criminal complaint filed in the matter, in late 2012, several Massena residents contacted law enforcement agencies to complain that they had been defrauded of money they had been promised by Ms. Hollinger as federal tax refunds or stimulus money. It is alleged that Ms. Hollinger maintained a Facebook posting that advertised that she was filing tax returns or stimulus claims and even if the person was not employed or had no income, Ms. Hollinger claimed she could file a tax return entitling the person to $5,000.
A woman, identified in documents only as A.A. and who had attended junior high school with Ms. Hollinger, told federal agents that a neighbor had contacted Ms. Hollinger through Facebook and provided her with personal information about A.A. and her boyfriend, including Social Security numbers, dates of birth and childrens names. A.A., who was not employed and was receiving public assistance, then contacted Ms. Hollinger through Facebook and text messages and allegedly was told that both she and her boyfriend would receive $1,500 in refunds, with Ms. Hollinger keeping $50 from each refund. Neither A.A. nor her boyfriend ever received any money, although IRS records reflect that a 2011 tax return was filed electronically for A.A., resulting in a $4,038 refund.
Agents showed A.A. a copy of the return, which showed her occupation as a baby sitter earning wages of $16,450, even though A.A. did no baby sitting and earned no wages. The $4,038 refund allegedly was sent to a Phoenix bank account in Ms. Zavala-Charress name. According to court documents, Ms. Hollinger had moved to Arizona after attending high school in Massena and had met Ms. Zavala-Charres in a battered womens shelter. Ms. Zavala-Charres told Ms. Hollinger that she used to be a tax preparer and, after Ms. Hollinger returned to Massena, Ms. Zavala-Charres asked her to recruit people whose personal information could be used in a tax fraud scheme.
According to the criminal complaint, Ms. Hollinger agreed to make contact with friends and associates to recruit people for the scheme. In addition to Facebook, she posted advertisements on Topix.com, presenting herself as tax girl and claiming she could get tax refunds. She then allegedly forwarded the information she obtained from acquaintances to Ms. Zavala-Charres, who prepared the returns. Some of the people who had provided information to Ms. Hollinger also sent text messages directly to Ms. Zavala-Charres.
According to the complaint, none of the people providing information knew that it was being used to prepare fraudulent tax returns and also did not know that refunds from the returns were being sent to Ms. Zavala-Charres. Ms. Hollinger allegedly was paid $50 for each referral, with Ms. Zavala-Charres loading money onto a prepaid debit card for Ms. Hollinger. Some Massena people who provided information to Ms. Hollinger did receive a portion of the refunds in the form of prepaid debit cards, although court documents show that agents are unclear as to how many people received refunds or how much they received.