H&R Block Manager Charged in Identity Theft Scheme
Los Angeles (April 20, 2012)
By Michael Cohn, Accounting Today
The manager of an H&R Block branch in Southern California has been charged with using the identities of his former tax preparation clients to file false tax returns with the Internal Revenue Service.
Damon Charles Dubose, 38, of North Hills, Calif., was charged Friday with one count of wire fraud and one count of filing false claims with the IRS. He was arrested in late March by special agents with the IRS’s Criminal Investigation division pursuant to a criminal complaint and was released on bond.
Dubose, working as a manager for H&R Block in Van Nuys, allegedly obtained the personal identifying information of his former clients and prepared bogus tax returns in their names to obtain tax refunds and credits, according to documents filed with the court. He then allegedly then used H&R Block Emerald Cards to withdraw the fraudulently obtained refunds from automated teller machines.
Shortly before midnight on Feb. 12, Dubose was seen by a patrolman in La Canada, Calif., loitering near the ATMs of three banks. Dubose was wearing pantyhose over his face along with beanies and a scarf. Inside his vehicle, the officer found six envelopes with a name and partial Social Security number handwritten on the outside, and an H&R Block Emerald Card on the inside.
The Emerald Cards allow H&R Block customers to access their tax refunds electronically like a debit card. Dubose’s vehicle also contained approximately $2,960 in cash and a printout of dates of birth and Social Security numbers that matched the handwritten information on the envelopes. Dubose claimed that the information was for his tax clients and he was authorized to make withdrawals on their behalf.
The Los Angeles County Sheriff’s Department obtained a search warrant for the home of Dubose’s girlfriend and found $6,900 in cash, six H&R block Emerald Cards, and the personal identifying information of more individuals.
Three taxpayers whose identifying information Dubose possessed were contacted by law enforcement. All of them said Dubose was not authorized to make withdrawals on their behalf or possess their personal identifying information.
Dubose allegedly transmitted the electronically filed fraudulent tax returns from Van Nuys, Calif. to Tennessee and West Virginia. His next court appearance is scheduled for April 30.
When contacted last month after Dubose’s arrest, H&R Block spokesman Gene King commented, “H&R Block takes this matter very seriously. This was an isolated incident and we are cooperating fully with authorities on the investigation of a former employee. The situation involves a small number of clients who have been contacted and informed of the steps the company is taking to help them and correct the situation.” Dubose declined to comment.
The Internal Revenue Service has come under increasing pressure to curb the growing trend of taxpayer identity theft. At a congressional hearing Thursday, IRS and Treasury Department officials discussed the steps they have been taking to crack down on identity thieves and flag suspicious returns.