17 Defendants Indicted for Committing $1.7 Million in COVID Tax Fraud
San Diego County District Attorney Summer Stephan today announced a grand jury indictment of 17 defendants who filed illegal tax returns claiming credits for COVID relief totaling more than $2.2 million. The case involves four separate San Diego-based criminal street gangs, including one rival gang, which participated in the tax fraud scheme for an ultimate loss to the IRS of $1,752,788.
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Photo of the tax refund confirmation and the jewelry bought by the defendant.
Defendant Stephen Pittman, Jr., 31, recruited individuals and assisted them in filing their fraudulent tax claims and then took a large percentage of the refund. Between April 2022 and October 2022, multiple known, violent, gang members conspired with one another to commit this scam for personal profit, and to benefit their criminal street gangs. Pittman used some of the money to purchase diamond encrusted Cartier and Rolex watches, three diamond chains, and a diamond encrusted necklace of his gang moniker.
“This case demonstrates the lengths to which streets gangs will go to seek novel ways to fund their violent criminal enterprises and line their pockets, in this case successfully bilking the taxpayers out of nearly two million dollars,” said DA Stephan. “The dedicated investigators and prosecutors handling this case followed the paper trail for months in order to allow us to file charges and hold these individuals responsible for this large-scale scam.”
The scam was simple. 2021 Tax Form 7202 included a line item intended for COVID Relief, entitled “Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals.” The IRS system stated, “Don’t enter more than 60 days” in this field. However, the number was manipulated to increase the fraudulent tax refund. In each of the co-defendants’ cases, more than 60 days were fraudulently inputted: ranging from 790 days to 15,678 days. As a result of the fraudulent entries, the returns garnered payments from the IRS ranging from $97,645 to $229,153 directly into their bank accounts.
The various defendants are charged with 81 felony counts including conspiracy to commit a crime, filing a fraudulent tax return, assisting in the filing of a fraudulent tax, receiving stolen property, and money laundering. Law enforcement arrested 14 of the defendants on Tuesday, two defendants were already in custody and one defendant remains at large. Arraignments for most of the defendants took place today in San Diego Superior Court. If convicted of the charges, the defendants face sentencing ranging from 16 months in jail, to life in state prison.
The fraud was discovered during the course of a homicide investigation when law enforcement found notice of an IRS refund on one of the suspect’s phones. That separate homicide investigation has led to four defendants being charged for the revenge murder of a rival gang member. That case is pending with one of the defendants having been convicted and sentenced to life in prison without the possibility of parole.
The San Diego Police Department’s Financial Crimes Division was the lead investigative agency on the case and prosecutors worked closely with the East County Gangs Task Force.
“This case is a testament to the thoroughness of our investigators, whose diligence not only helped solve a homicide but helped uncover a significant criminal scheme involving a network of street gangs,” said SDPD Chief Scott Wahl. “The funds these suspects siphoned away were meant for the community most deeply touched by the pandemic, and that’s fraud our department won’t stand for.”
The defendants named in the grand jury indictment are Dajon Johnson, 23, Deonte Sherman, 29; Cora Wulff, 25; Roshan McKinney, 29; Shamira Clark, 21; Ashley Davis, 34; Shamar Garcia, 37; Haben Haile, 26; Stephen Pittman, Jr., 31; Jenelle Poutoa, 27; Brandon Scales, 53; Donte Sheffield, 35; Dominik Wells, 47; Gregory Baul, 23; Michael Brooks, 41; Tahamon Brooks, 53; and Michael Bullock, 55.
This case is being prosecuted by Deputy District Attorneys Vanessa Gerard and Ted Fiorito.
