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The Prescott Daily Courier | Prescott, Arizona

home : latest news : local August 01, 2014


3/27/2013 10:01:00 PM
Alleged $1M tax scam foiled: 11 inmates charged with plotting to defraud IRS
Scott Orr
The Daily Courier

CAMP VERDE - Eleven inmates at the Yavapai County Jail have been charged with taking part in a scheme while they were behind bars to defraud the Internal Revenue Service to the tune of a million dollars, and more inmates may have been involved, according to court documents.

Justin Eugene Shaw Young, 27, is accused of being one of the ringleaders who ran the scam. He's facing 126 criminal counts, including fraudulent schemes and artifices, forgery, and identity theft.

Yavapai County Sheriff's Office Detective Todd Swaim headed up the investigation. In a probable cause statement, Swaim said Young had written plans for a "million-dollar IRS tax fraud."

Young's plan included other inmates, whose social security numbers and other information he wrote on the forms. They were to pay him $1,000 of the $3,000 to $5,000 they expected to get in the form of a tax refund they weren't entitled to, Swaim said.

If they were ever caught, the others were to "tell the truth and say they had never filled out or filed the fraudulent tax form," Swaim said. Young filed returns for 2010 and 2011 along with 2012 returns.

"(Young) was showing the subjects who gave their name and social security number working at jobs that didn't even exist or they had never even worked," Swaim said.

The refunds were to be placed on disposable - and untraceable - debit cards supplied by recruits outside the jail.

Young first tried to file 37 completed and signed 1040EZ forms, totaling over $137,000 in expected refunds, Swaim said, and five days later, another 23 fake tax returns with refund amounts that added up to $132,000.

Young allegedly planned to keep the scam running when he was sent to prison. "With... help on the outside," Swaim said, "they would be able to make 2.2 to 6 million dollars on this tax fraud and then leave the country to Belize where there is no extradition."

When confronted, Young admitted he had been operating the scam and said he had used more than 33 people's IDs to fill out forms, Swaim said.

Also implicated is James Edward Borboa, indicted on 55 counts, who Swaim said was running the scam with Young after Young told him how to do it.

Borboa's forms included one for an 18-year-old cellmate who, he said, made $52,000 at age 16 and requested a refund of over $5,000.

A confidential informant said Borboa had actually pulled off the scam "for years" by having inmates sign power-of-attorney forms so he could cash their IRS checks, Swaim said, and he cited one example of an inmate whose ID had been used to obtain a fraudulent $5,200 refund.

Swaim said Young and Borboa expected more than $340,000 from the falsified returns.

Others charged include inmates who participated with Young and Borboa:

• Scott Anthony Backus, 29

• Kevin Maurice Dancy, 23

• Tyler Patrick Ewert, 19

• Edwin Manuel Jaramillo, 47

• Steven Lewis Stinson, 22

• Andrew Lee Thompson, 29

• Marvis James Victor, 21

Two inmates whose names were not available Wednesday were also charged.

The Yavapai County Public Defender's Office has been forced to hire attorneys from Phoenix, Flagstaff and elsewhere because ethical conflicts prevent its own lawyers and "virtually every local contract attorney" from representing nine of the defendants, Dean Trebesch, County Public Defender, said.

"In the past, we (the Public Defender's Office) have represented more than one of these co-defendants on other various charges," Trebesch said. "Once you do that, you can't represent those defendants on new matters where they are co-defendants with each other and whose interests may be adverse to each other."

Trebesch said the ethical issues involved prevented him from speaking specifically on the cases.



Related Stories:
• Massive jail tax scam stopped by mailroom personnel


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Reader Comments

Posted: Saturday, March 30, 2013
Article comment by: S L

Good job mail room guy!

Posted: Friday, March 29, 2013
Article comment by: Button Square Pants

It's interesting how people will cry about an inmate that is locked up 23 hours a day and how they aren't able to have the luxeries of those who aren't locked up, but then when something like this happens, the same people cry about how they're given too much freedom. C'mon people, which is it? Figure out what side you're on and stick with it!

Posted: Thursday, March 28, 2013
Article comment by: @@Human Nature

O Yea, I forgot! Every one in jail is innocent!
And, everyone not in jail is guilty. This is O Bama's world now. Everything is backwards.


Posted: Thursday, March 28, 2013
Article comment by: @ Human Nature

Gotta love it! Just to remind you in the USA you are innocent until proven guilty! Got it? Many people in the County Jail here are innocent and awaiting trial just like I was in there. Many people in there can't get out because of unreasonably high bonds set by judges in this County that have their own personal agendas.Just because someone is arrested here does not make them guilty. ...

Posted: Thursday, March 28, 2013
Article comment by: Northwest Yavapai

Two things in this article are interesting. One, these guys need to remember that when it comes to stealing money, government be it city, county, state or federal does not like competition. Two, having to hire outside attorneys because of {ethical conflicts}? When and where do ethics have anything to do with lawyers?

Posted: Thursday, March 28, 2013
Article comment by: Federal Scam Government

The IRS didn't appear to be interested in this case but they will surely come after you if you violate one tenent of Obamacare or take one deduction that you aren't entitled to. This can't continue for long people, total collapse is near.

Posted: Thursday, March 28, 2013
Article comment by: L C

I would rather have American inmates collecting than illegal aliens.

Posted: Thursday, March 28, 2013
Article comment by: Human Nature!

Shouldn't "EVERYTHING" an inmate does be supervised?

If Not, Why Not? Why do you think there in Jail? Steeling others freedom that's why! Inmates can not be trusted to do the right thing. That's why they are in jail. Unattended inmates will do what is wrong and their every move needs to be watched.

Does anyone in charge of the jail have any understanding of human nature?

Inmates should not have freedom since they steel freedom from others. Which means they should not have TV, INTERNET, PHONES, or anything free people are able to use. Just like when I grounded my teenager.

The only thing I would give them is the Holy Bible with daily reading assignments and teaching them how to live in a civilization.


Posted: Thursday, March 28, 2013
Article comment by: Joe Justice

Just remember you got a lotta time for thinking while sitting in the Verde Valley jail. Almost sounds like I've spent some time there, oops...All I can say is who needs Jenny Craig when you've got the jail here, heck I lost 25lbs. in 4 months and it only cost me $2.00 a day...LOL

Posted: Thursday, March 28, 2013
Article comment by: Common Sense

Stuff like this happens by the the thousands every day for the simple reason that the Federal Government is in the business of giving tax "Refunds" to people who didn't pay any taxes. Everybody thinks these inmates pulling this scam are so awful but thousands of your neighbors are happy to steal from taxpayers when they get their "REFUND" checks this spring.

Posted: Thursday, March 28, 2013
Article comment by: J S

The facts are that the government has lost control. It is faking that it is capable of managing the collapse.
I know of a business owner in town who has received $37,000 in refunds by claiming workers that do not exist or are illegals and do not file. He has been doing this for a few years. My sister is his operations manager and in on it. She does what she is told and gets a share. I have tried to go to the IRS but they are not interested. Neither is ICE.


Posted: Thursday, March 28, 2013
Article comment by: April Fools

It's hard enough to find all the tax forms you need at the library or post office....but, in the jail they've got it all....get together for scam meetings, provided with pens, envelopes, stamps, forms...a chance to discuss their operations and mail 9 or more forms for jobs they aren't working at while in jail. ahhhh, this must be an april fool joke!!!!

Posted: Thursday, March 28, 2013
Article comment by: Carl Imparel

Great, throw em in jail...oops@!



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