SACRAMENTO, Calif. - Tosh Babu, 33, of Stockton, was sentenced today by U.S. District Judge Troy L. Nunley to two and a half years in prison for conspiracy to submit false claims, U.S. Attorney Phillip A. Talbert announced. Judge Nunley also ordered Babu to pay $94,451 in restitution to the IRS.
According to court documents, between Sept. 28, 2010, and Oct. 30, 2012, Babu conspired with others to submit tax returns to the IRS that falsely claimed that the persons named on the returns were entitled to tax refunds. The conspirators obtained the names, social security numbers, and other personal identifying information of various individuals and used that information, often without the knowledge of those people, to submit the tax returns in their names. Altogether, they submitted at least 1,367 false tax returns, requesting approximately $962,853 in tax refunds. The IRS paid more than $252,000 in fraudulent tax refunds as a result of the scheme.
“Mr. Babu took personal identifiable information (PII) from homeless individuals and used the PII for personal gain by preparing and filing false tax returns with IRS," said Michael T. Batdorf, Special Agent in Charge IRS Criminal Investigation. “He then negotiated those fraudulent tax refund checks by depositing them in bank accounts under the control of co-conspirators. Individuals thinking about participating in fraudulent tax schemes should consider the real consequences of these types of illegal actions. Those include going to prison, being branded a convicted felon for the rest of their lives, and paying back restitution to the IRS for all the taxes owed."
Babu pleaded guilty on May 25, 2017. On July 14, 2017, co-defendant Christopher M. Grady, 35, of Stockton, was sentenced to three years of time already served in prison for conspiring to submit false claims to the Internal Revenue Service and aggravated identity theft. Co-defendant Jacob Cook, of Stockton, pleaded guilty on May 4, 2017. He was sentenced by Judge Nunley on September 7, 2017, to two and a half years in prison.
Co-defendant Jeffrey Grady, of Stockton, is next scheduled for a status hearing before Judge Nunley on Dec. 14, 2017. The charges against him are allegations only, and he is presumed innocent until and unless proven guilty beyond a reasonable doubt.
This case is the product of an investigation by the Internal Revenue Service - Criminal Investigation. Assistant U.S. Attorney Matthew G. Morris is prosecuting the case.
Source: U.S. Department of Justice, Office of the United States Attorneys
