Former University of South Dakota Football Player Running A $1.1M Tax-Fraud Scheme Got Caught In The Dumbest Way
Alphonso “Rico” Valdez was running a $1.1 million scheme to defraud the IRS. In his spare time, he was running drills for the University of South Dakota football team.
Valdez recruited fellow students, friends from home and even his girlfriend to join his crazy scheme that involved preloaded debit cards, stolen identities and a ton of money. After an intensive investigation, lasting several months, authorities busted up the fraud ring. Before it all came crashing down, which netted Valdez and his accomplices about $400,000 in just over a year.
According to Fox News, “six people involved in the complicated scheme were USD football players at the time, and another had once been on the track and field team and impeached as USD’s student government president over allegations of misused funds. All 11 involved have pleaded guilty to federal fraud charges in Sioux Falls. Valdez, the 23-year-old ringleader, and a co-conspirator are to be sentenced Monday. Those already sentenced received prison times ranging from 2 years to more than 5 years and all but three were ordered to pay $422,000 in joint restitution.”
The scam worked like this — Valdez and his crew gathered names, addresses, Social Security numbers and other information and used the data to file fraudulent tax returns. They used addresses that weren’t associated with the victims so members of the crew could retrieve the refunds without the victims knowing. Valdez’s girlfriend did most of the damage — she worked at an insurance company at the time and collected more than thirty Social Security numbers.
Just like most million dollar scams, eventually the feds catch on, but it wasn’t because of ridiculous spending or loose lips. Valdez and his crew didn’t make absurd purchases or flash sick jewelry or cruise around in a hot car.
“I’m not even sure that any of them had a car while they were here, and if they did, it probably wasn’t a nice one,” USD athletic director David Herbster said. “They didn’t exhibit anything that you would be overly suspicious of as far as somehow coming into an excess amount of money. There were no really nice cars, there was not a lot of fancy clothes, fancy jewelry things like that that would lead you to believe, `How did you get that?”‘
So what got Valdez pinched? A hoodie on a warm day and a nosey citizen.
He wore a hoodie and a stocking cap as he made multiple trips to an ATM on a warm day in April 2012, cutting a suspicious enough figure that a concerned citizen tipped off police in the college town. Using surveillance video, they discovered a cornerback for the University of South Dakota’s football team was using a preloaded debit card that had been issued for a tax refund.
Guilty until proven innocent. Especially if you’re sporting a hoodie.
[H/T Fox News]