Hacienda Heights man gets 30-months in prison for father-son tax return scheme

LOS ANGELES >> A Hacienda Heights man began serving a two-and-a-half-year prison term after he was sentenced for his role in a scheme that netted more than $2.6 million in bogus tax returns using stolen identities, authorities said.
Heber Cotton, 40, pleaded guilty late last year to a count of conspiracy to defraud the federal government by obtaining the payment of fraudulent tax refunds, U.S. Department of Justice spokesman Thom Mrozek said in a written statement. U.S. District Judge Michael W. Firzgerald handed down the 30-month prison term Monday in federal court in Los Angeles.
Cotton was additionally ordered to pay $725,000 in restitution.
His father and co-conspirator, 64-year-old Adel Cotton, pleaded guilty to the same charge in 2012 and has since been sentenced to 4 years and three months in federal prison, officials said.
“This father and son pair prolifically defrauded the government and hundreds of taxpayers, earning them the significant sentences imposed by the court,” according to United States Attorney for the Central District of California Eileen M. Decker.
From December of 2008 to March of 2010, “the Cottons caused at least 275 fraudulent income tax returns to be filed with the IRS,” Mrozek said. “Those fraudulent returns sought income tax refunds totaling more than $2.6 million.”
The father and son used the names and social security numbers of victims without their knowledge to fill out fraudulent tax returns, officials said. They instructed the refund checks to be sent to addressed they controlled.
Heber Cotton admitted in court documents that he gave stolen identity information to a co-conspirator, who worked as a bank manager, who opened bank accounts with the fraudulently obtained funds, in exchange for a 20 percent cut of each refund check.
The bank manager, identified in court documents as Michael Rodriguez, managed a U.S. Bank branch inside a Tustin supermarket, Mrozek said.
He has since pleaded guilty to charges in connection with the scheme and is awaiting sentencing.
“These unscrupulous defendants, a father and son team, thought they had figured out a clever scheme to thwart the IRS and steal from American taxpayers,” IRS Criminal Investigation’s Acting Special Agent in Charge Anthony J. Orlando added. “IRS CI has made investigating refund fraud and identity theft a top priority and we will vigorously pursue those who undermine the integrity of the U.S. tax system.”

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