SAN FRANCISCO — Sheila Denise Dunlap pleaded guilty in federal court today to participating in a conspiracy to commit wire fraud and aggravated identity theft, U.S. Attorney Stephanie M. Hinds, Special Agent, announced. of the Internal Revenue Service-Criminal Investigation (IRS-CI) in Charge Mark H. Pearson, and United States Department of the Treasury, Special Agent in Charge of the Treasury Inspector General for Tax Administration (TIGTA), Rod Ammari.
Dunlap, 51, of Modesto, was charged in a federal indictment on May 13, 2021, with participating in a wire fraud conspiracy to file dozens of fraudulent claims for Economic Impact Payments (EIPs), commonly known as stimulus checks. The EIP program was part of the CARES Act, a federal relief bill enacted on March 27, 2020 to address the economic fallout from the COVID-19 pandemic. Under the EIP provision of the CARES Act, people who earned less than $99,000 on their 2019 tax returns and those whose income was low enough that a tax return is not required (known as non- registrants) were eligible to receive EIP funds. EIP payments were $1,200 per adult and $500 for an eligible child.
In her plea agreement, Dunlap admitted that she conspired from March 2020 to July 2020 with her son to obtain the personally identifiable information (PII) of others and use those PII to request EIP funds. Dunlap’s son was serving a capital sentence on death row at San Quentin State Prison.
Dunlap admitted in his plea agreement that his son, identified in the agreement only by the initials DW, had sent him the PII of his fellow inmates as well as the PII of other people they suspected were considered non. -filers of 2018 or 2019 income tax returns, thus making them eligible for EIP funds. Dunlap admitted to using these PII to file several fraudulent requests for EIP funds through the Internal Revenue Service’s online EIP portal. In each of the requests, Dunlap listed his own Bank of America account to receive payments.
Dunlap detailed in his plea agreement that in or around April 2020, his son coordinated with another to email him a spreadsheet containing the PII of 9,043 people. His son advised Dunlap to file the fraudulent EIP claims using the PII of the youngest listed adults first. DW and Dunlap both opined that these younger, college-age individuals likely lacked sufficient income to trigger the filing of a 2018 or 2019 tax return and were therefore likely non-filers eligible for EAP payments. .
Dunlap admitted that in May and June 2020, she used the PII of these real people — which included their names and Social Security numbers — to electronically file 121 EIP claims. Dunlap admitted that each EIP claim contained misrepresentations and directed payment to his bank account. In total, Dunlap filed claims for $145,200 in EIP payments.
Dunlap pleaded guilty to one count of wire fraud conspiracy in violation of 18 USC § 1349, which carries a maximum statutory sentence of 20 years in prison and a fine of $250,000 or no more than the greater of two. times the gross gain or twice the gross loss. Dunlap also pleaded guilty to one count of aggravated identity theft in violation of 18 USC § 1028A, which is punishable by two years in prison consecutive to any other sentence imposed and a maximum fine. of $250,000. A sentence, however, will only be imposed by the court after considering the US Sentencing Guidelines and the federal law governing sentencing, 18 USC § 3553.
Dunlap is scheduled for her sentencing hearing before United States District Judge Susan Illston on June 24, 2022. She is still not in custody.
The case was prosecuted by US Assistant Attorneys Yoosun Koh and Annie Hsieh, with assistance from Llessica Chan Fierro, Ralph Banchstubbs and Maribel Gallegos. The charge is the result of an investigation by IRS-CI and TIGTA.