If you’re going to commit a crime, you might as well go big. Why limit your tax fraud to a few thousand dollars when you can get $2.1 million for your efforts.
Krystle Marie Reyes from Salem Oregon was arrested for submitting an Oregon state tax return requesting the huge refund on a tax return she prepared herself using Turbo Tax. Her refund was loaded onto a debit card and off she went spending all that money. (Yeah! A prepaid debit card for $2.1 million!) She was caught when she requested a second replacement card.
Of course, everyone is in an uproar about how this could happen. Oregon, like the IRS and most states, is working shorthanded with outdated computers. Earlier this year, a $100 million program to upgrade Oregon’s tax computer was stopped. The upgrade would have paid for itself by stopping tax fraud like the one Ms. Reyes is alleged to have pulled off. According to one report, her refund request did trigger an alarm and her return was reviewed by several live people but it was still approved. And why did it take a second request to replace a lost debit card before Turbo Tax caught on to a problem? Lots of people will have some serious explain to do on this case.
The one unanswered question I have is if she scammed a state for $2.1 million what did she do on her Federal return? Are there IRS agents scrambling to find and check her recent 1040’s? I really hope so.