A Lemon Grove woman was sentenced Wednesday to 175 months in prison for carrying out two complex fraud schemes involving identity theft, false tax returns and hundreds of unwitting victims.
In all, Cynthia Lozano, 35, sought more than $2 million in refunds from false tax returns, according to the U.S. Attorney’s Office in San Diego. She was sentenced for 84 counts of mail and wire fraud, false claims and aggravated identity theft.
In addition to handing down the 14 1/2-year custody term to Lozano, U.S. District Court Judge Anthony Battaglia ordered her to pay about $1.48 million in restitution to the Internal Revenue Service and U.S. Department of Housing and Urban Development.
In April 2013, Lozano was charged in a 33-count indictment for allegedly filing false tax returns in the names of people who often were unaware that she was using their identities to defraud the government.
According to prosecutors, Lozano directed the IRS to deposit tax refunds via electronic transfers into bank accounts opened under the names of relatives and associates.
For some actual tax-preparation clients, Lozano claimed a larger refund than she represented to them, directing the IRS to deposit the excess amounts in one of the bank accounts under her control without her customers’ knowledge.
In total, Lozano used the identities of more than 200 victims to file in excess of 400 federal tax returns, netting more than $1.5 million in fraudulent tax refunds between 2008 and 2013, prosecutors alleged.
The defendant used the majority of the funds obtained from her initial scheme to purchase 20 properties in and around Phoenix, Arizona, court documents state.
In February 2015, Lozano pleaded guilty to two criminal counts in connection with the scheme.
Four months later, while Lozano was awaiting sentencing, agents from the IRS and Department of Treasury discovered that she had filed additional federal tax returns in a manner similar to that of her previous scheme.
She was then charged in a second indictment with 51 additional counts, including false claims to the IRS, wire and mail fraud, and aggravated identity theft.
Some of the victims of Lozano’s second scheme were actual or prospective tenants at the Arizona properties she had bought with funds from her earlier fraud. After Lozano purchased the real estate, she transferred the titles to the name of her mother, who does not live in the United States.
Using her mother’s identity as an alias, Lozano obtained authorization to rent some of the Arizona properties under the Department of Housing and Urban Development’s Section 8 voucher program, through which a local public- housing authority supplements rent to a property owner on behalf of qualifying tenants.
For the 2015 scheme, Lozano obtained the names and Social Security numbers from her Section 8 tenants and others who submitted rental applications to her, then used the information to submit additional false federal tax returns.
Lozano proceeded to direct the IRS to deposit the tax refunds into new bank accounts she opened with the assistance of two co-conspirators who have since pleaded guilty and been sentenced for their participation in the conspiracy.
In August of last year, Lozano pleaded guilty to 31 additional criminal counts from the first indictment. Three months later, she pleaded guilty to all 51 counts of the second indictment.
Lozano’s crimes amounted to a “white-collar crime spree that continued even after she got caught,” Acting U.S. Attorney Alana Robinson said.
“It is astounding that she committed a second major fraud while awaiting sentencing for the first,” Robinson said. “Her greed-fueled rampage (ended) today, with a sentence that recognizes the significant losses suffered by her victims, including U.S. taxpayers.”
A status hearing regarding forfeiture of the properties Lozano purchased with the proceeds from the original scheme is scheduled for Aug. 25.
–City News Service
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