On Q Professional Investigations

Wifredo A. Ferrer, United States Attorney for the Southern District of Florida; Jose A. Gonzalez, Special Agent in Charge, Internal Revenue Service-Criminal Investigation (IRS-CI); Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office; and Paula Reid, Special Agent in Charge, United States Secret Service (USSS), Miami Field Office, announced the unsealing of a 43-count indictment charging defendants 11 South Florida residents with stolen identity tax refund fraud. Charged in the indictment are Henry Dorvil, aka “D,” 35, of Hollywood; Herve Wilmore Jr., 29, of Aventura; Dukens Eleazard, aka “DK,” 33, of Pembroke Pines; Marie Eleazard, aka “Fanfan,” 32, of Miami; Jesse Lamar Harrell, 26, of Miramar; Luckner St Fleur, aka “Nene,” 32, of Miami; Ruth Cartwright, aka “Princess,” 30, formerly of Plantation; Miguel Patterson, 35, of Miami; Brandon Johnson, 29, of Miami Gardens; John Similien, 24, of Plantation; and Marc Leroy Saint Juste, 26, of Tamarac. Defendants Dorvil, Harrell, Patterson, Johnson, and Saint Juste made their initial appearances in federal court before U.S. Magistrate Judge Lurana S. Snow in Fort Lauderdale at 1:00 p.m. today. Defendant Cartwright was arrested in the Northern District of Georgia and will make her initial appearance there. Defendants Wilmore, both Eleazards, St Fleur, and Similien remain at large.

Specifically, each defendant is charged with one count of conspiring to defraud the Internal Revenue Service, commit wire fraud, and commit aggravated identity theft, all in violation of Title 18, U.S.C. § 371; as well as two counts of wire fraud, in violation of Title 18, U.S.C., §§ 1343 and 2. In addition, defendants Dorvil, Wilmore, Dukens Eleazard, Marie Eleazard, Harrell, St Fleur, Cartwright, Patterson, Johnson, and Similien are charged with two counts of aggravated identity theft, in violation of Title 18, U.S.C. §§ 1028A(a)(1) and 2. The indictment also seeks the forfeiture of $443,449.07 seized from a bank account; a 2011 Cadillac Escalade EXT Premium Sport and 2010 Nissan Maxima registered to defendant Dukens Eleazard; a 2011 Infiniti M37 registered to defendant Marie Eleazard; and a 2010 Porsche purchased by defendant Wilmore.

According to the indictment, the defendants recruited knowing participants and unknowing victims to put businesses, bank accounts, and Electronic Filing Identification Numbers (EFINs) in the defendants’ names. The defendants used this information to execute their fraud scheme, including tax refund fraud. The defendants also used the personal identification information of real people, including some deceased, to file false income tax returns with the IRS. In this way, the defendants received IRS refund checks [U.S. Treasury checks and Refund Anticipation Loan (RAL) checks] at addresses and bank accounts that they controlled. To avoid having the fraud discovered, the defendants negotiated the fraudulently obtained income tax refund checks at each other’s businesses.

According to the indictment, from about January 2009 through March 2012, the defendants filed with the IRS approximately 6,961 federal income tax returns, requesting refunds totaling approximately $34,096,321. Of the 6,961 field tax returns, 2,763 used the identities of deceased individuals.

U.S. Attorney Wifredo A. Ferrer, “Stolen identity refund fraud is spreading in South Florida like an out of control wildfire. Two days ago, we announced charges against 14 individuals in six separate cases on charges of stolen identity refund fraud. Today, in just one case, we are charging another 11 individuals who used stolen identities, including that of almost 3,000 deceased persons, to file fraudulent returns seeking close to $35 million in tax refunds. My office, in conjunction with the members of the South Florida Identity Theft Tax Fraud Strike Force, will continue to prosecute these thieves, not just to punish them, but also to deter others from thinking they can get away with stealing honest taxpayers’ hard-earned refunds.”

Special Agent in Charge Jose A. Gonzalez stated, “These defendants conspired to use the personal identification information of taxpayers, including deceased individuals, to file false income tax returns with the IRS. These actions not only pose a serious problem for taxpayers but adversely affect the integrity of our tax system. Together with our law enforcement partners, we will continue to remain vigilant in identifying, investigating, and prosecuting those individuals who seek to willfully defraud the United States Treasury and have a blatant disregard for the victims of their schemes.”

“Unfortunately, this is another example of the rapidly growing wave of stolen identity tax refund fraud,” said Xanthie C. Mangum, Acting Special Agent in Charge of FBI Miami Division. “The FBI continues to actively target these fraudsters who seek illicit gains by victimizing hard-working taxpayers.”

Secret Service Special Agent in Charge Paula Reid stated, “The existence of identity theft in the South Florida region is an unfortunate criminal epidemic. At any time, anyone is subject to being a victim. The investigative efforts of the law enforcement community must remain strong and unwavering as the offenders’ continuous success and harm with this stealthy crime cannot prevail.”

If convicted, the defendants face a possible maximum statutory sentence of five years in prison for the conspiracy count, 20 years in prison for each count of wire fraud and two years consecutive in prison for each count of aggravated identity theft.

Mr. Ferrer commended the investigative efforts of IRS-CI, FBI, and USSS. Mr. Ferrer also thanked the U.S. Postal Inspection Service, U.S. Immigration and Customs Enforcement, Homeland Security Investigations, Department of Labor, and the Social Security Administration for their help on this matter. The case is being prosecuted by Assistant U.S. Attorney Neil Karadbil.

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It’s one of the best-kept secrets in the federal government.

Information about polygraph screening is so guarded by the agencies that use it that job applicants who are tested are urged not to tell anyone. The news media are denied basic information, such as how many government employees are screened, because it’s “sensitive” and could jeopardize national security.

Researchers are told they can’t get studies about how it works. Even the National Academies, the organization set up to advise the federal government on scientific matters, faced stiff resistance when it reviewed polygraph testing. As a result, the academies compared the polygraph profession to the “priesthood keeping its secrets in order to keep its power.”

“It’s a siege mentality,” acknowledged Gordon Barland, a retired federal polygraph researcher who supports polygraph screening but also pushed for greater transparency on some of the data.

Many of the 15 agencies that rely on polygraph testing for job applicants and employees say they’re protecting screening methods from spies or terrorists who might figure out how to infiltrate the government. An unknown number of government polygraph studies remain classified because of this fear. But critics and even some supporters say the federal government should be more open about its programs given the growing use of polygraph screening and the continued scientific controversy over it.

Barland, one of the most prolific government polygraph researchers, asked government officials to publish several classified studies on polygraph screening that he participated in. They declined.

Other government researchers who’ve pushed for publishing such studies also have been turned down, Barland said. Some have left the government in frustration. Researchers and academics generally think it’s essential for studies to be published and peer reviewed. Barland said the government would have benefited from publicizing several of the studies because they demonstrated that polygraph screening worked, but he blames labor unions and civil libertarians for making polygraphers gun-shy.

“They don’t want to give critics any more ammunition,” he said.

Job applicants and employees also are denied the recordings of their polygraph screenings and the charts that polygraphers relied on to determine whether they’re lying. If they want any other records about sessions, they have to file open records requests. Nonetheless, documents often are withheld or redacted for national security reasons. The information is so guarded that people who are polygraphed are urged to “maintain confidentiality” and not to tell co-workers, relatives or friends, documents obtained by McClatchy show.

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You don’t need to be Mensa qualified to understand the importance of background checks for bringing on board new hires, especially in some industries. The Liars Index, a report compiled by Jude M. Wern & Associates, reported that nearly 21 percent of resumes had false education claims for the period of the first half of 2012. But that doesn’t mean that the need for this type of hiring strategy is widely needed across the board. These are some industries that may or may not be immediately obvious that definitely should have pre-employment background screening for all employees.

The Education Industry

In this day and age, anyone who is dealing with children is a prime candidate for a thorough background check. Most schools today don’t limit this to the people who have direct access and responsibility for the children, but also for every substitute teacher, parent volunteer, custodian, bus driver, and teacher’s aide.

Background checks for people in the education industry aren’t limited to criminal histories alone. Most states require certain certifications in order to teach or work in certain capacities within the schools. Background checks also serve to verify that the person in question is who he or she claims to be and that he or she also has the required certifications and endorsements.

The Financial Services Industry

Whether or not your employees handle money directly, it should go without saying that if you have employees working in a financial setting, it’s vital to obtain screen them with a background check before hiring. Credit unions, banks, accounting firms, mortgage brokerages, investment companies, and tax preparation firms are all examples of types of companies in the financial arena that need this extra screening criteria.

The Gaming Industry

This is an industry that has a reputation of less than savory practices. That’s one reason that current rules and regulations concerning gaming establishments are so stringent. Most gaming industry businesses are governed by some authority of the state.

It’s the state that makes most of the rules about the types of background checks that are required of employees in which positions. Security staff, surveillance staff members, casino bank managers (sometimes referred to as cage managers), and high ranking members of the casino hierarchy, those who have direct access to cash, are required to go through varying degrees of pre-employment background screening. There’s too much money that goes into and out of a casino each and every day to place people with poor money management, criminal histories—especially with crimes involving money, and other background check red flags in positions of responsibility when it comes to money.

The Hospitality Industry

Do you run a bed and breakfast, quaint inn, or small motel? If so, you most likely have housekeepers that are armed with key to gain access to guess rooms — and it would be more than appropriate to conduct a background check on these and other hospitality employees, such as the bellhop.

The Caregivers Industry

This is an industry where background checks tend to be a little wider reaching than some of the others. Caregiver screenings should cover criminal background screenings for abusive behavior in the past, sex offender registration, drug screenings, and financial screenings. Depending on the specific caregiving role you’re hiring for, there may also be the need for additional screening to verify certifications and/or education.

Caregivers not only have access to patients, their possessions (in some cases), and their families; some caregivers also have access to the, sometimes; powerful medications they are required to dispense in their roles are care providers.

While these industries may seem so large, and there are plenty of small businesses within each of them — and it’s often the small businesses that struggle most when it comes to employees who are either innocently dishonest on their employee applications or tell blatant lies in the interview process. Besides conducting employee background checks, another option to consider is purchasing employee dishonesty insurance coverage to help defray any costs to you that occur as a result of hiring this particular candidate.

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As small businesses increasingly leverage employment screening to help ensure a safe workplace and improve their quality of hire, many may be overlooking common gaps in their screening program that could be unknowingly exposing themselves to risk.

To help ensure a more effective and compliant background screening program, small businesses should consider these four best practices:

1. Put the Policy in Writing

A written employment screening policy is an essential component of a successful program. According to the HireRight Small Business Spotlight, 29 percent of small business respondents plan to create a formal screening policy, while 19 percent plan to draft a policy specific to drug, alcohol and health screening.

Employment screening policies can help protect your organization from potential claims of discrimination and assist in regulatory audits. The policy will also set clear screening standards for human resources personnel.

In the policy, the organization should describe the employment background checks that they are going to run and how the screening results will be used to make hiring decisions. To help protect against discrimination suits down the road, it is best to tailor the screening criteria to each specific position that will be subject to background screening.

For example, an organization might consider including a credit check (if allowed by applicable law) as a screening component when screening for a position that involves access to organization funds. To ensure compliance, it is important to always have experienced legal counsel review the screening policy.

2. Strengthen Your Criminal Checks

Criminal background checks are conducted by 88 percent of small businesses, according to respondents of the HireRight Small Business Spotlight. However, the effectiveness of a criminal background screening program often depends on the types of criminal background checks that are conducted.

Gaps in criminal background checks may exist based on the search criteria (e.g., the geography searched and time frame) as well as when the check is conducted occurs and the frequency. Many employers only use criminal checks during hiring for full-time employees, and do not check for criminal offenses after the person has been employed by the company.

Employers can help mitigate negligent hiring risks by increasing the depth and geography of criminal background checks. For example, by expanding criminal checks to include county, state and federal criminal and sex offender searches in all jurisdictions in which the applicant has lived or worked in the past 10 years, the employer can cast a wider net and gain better protection

3. Check More Than Just Criminal History

On-demand background screening providers help small businesses enhance their screening programs effortlessly. Yet, less than half of all small business employers conduct background checks beyond basic criminal and identity checks.

Without verifying a candidate’s employment and education history and motor vehicle records, as relevant, employers may be missing crucial red flags or information that could dramatically impact a hiring decision.

By working with an on-demand background screening provider, employers can implement multiple types of background checks into one seamless process that provides better insight into the candidate. For example, checking employment and education history can ensure that candidates really do meet your job requirements and were honest about their qualifications for the position.

4. Reassess Your Program

According to the HireRight Small Business Spotlight, 44 percent of small business respondents plan to review their employee screening standards and an additional 15 percent plan to evaluate their contingent worker screening standards.

This data reveals a gap; more than half of small businesses are not regularly assessing their employee screening standards and that more than three quarters are not reviewing their contingent worker screening standards.

As industry best practices and state and federal regulations evolve, employers that do not re-evaluate their screening programs could expose themselves to greater compliance and legal risks.

It is a best practice for small businesses to self-audit their employment screening program at least once per year. Employers should also monitor legislative changes that may impact their hiring process such as those addressing the use of medical marijuana and the requirements for worker eligibility.

By reviewing and implementing these four best practices, small businesses will be able to achieve a more effective background screening program and obtain higher quality talent.

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If you pay peanuts you get…… This holds true for private investigations and back ground checks too. What will be the better avenue to take when investigating?

It’s no secret to anyone at this point in time that we’re definitely living in a digital age. That said, computers and digital data are more than just conveniences that we can take or leave. They’re important parts of many aspects of our lives. This is especially the case when it comes to the evaluation of specific individuals for any number of reasons.

Background checks may have seemed like science fiction a long time ago, but nowadays they’re par for the course and have a number of uses. Employers perform background checks on potential hires in order to confirm information and evaluate their character. People even order background checks on acquaintances, neighbors, or potential spouses wishing to better know who it is that they’re really letting into their lives and allowing around their loved ones.

However, one thing people never really consider is the importance of hiring professionals to conduct background checks in order to make sure that information gathered is accurate and as valuable as it should be.

The Myth of Online Background Check Services

As much as computers and the internet have brought a wealth of convenience and choice into the modern person’s life, there are certainly ways in which this can easily backfire. A common misconception in regards to background checks today is that those inexpensive services you can use online actually have the value that they should. Sure you can pay your $50 or so and wind up with plenty information that looks extensive. However, it’s important to note that the most important information is actually left out of a lot of those reports.

Background checks should consist of more than a list of old addresses and phone numbers. Real ones also include extensive criminal records, credit information, traffic violations, civil court records, and so forth. The best way to make sure your background checks contain all of the necessary information is to hire a professional to conduct them.

What to Look for in a Good Private Investigations Firm

One way to get a really solid background check conducted on a given individual is to locate a reputable private investigations firm and enlist their services. Background checks are important parts of many different types of investigations, so most PI’s are going to be old hats when it comes to performing thorough ones. They know what to look for, what a given check should entail, and how to make sure they find all necessary information out there to be had.

When evaluating a given firm, it’s important to ask about their experience level in regards to not only background checks, but investigations in general. Do they have any credentials they can present to prove their mettle? How many years have they been in business? What kind of experience do they have with performing background checks in regards to your unique type of situation – spousal investigation, employee background checks, and so forth? How about references you can call?

You will also want to make sure that the firm you choose makes use of all the technological options available to the world of private investigation today. A good PI firm knows the ins and outs of combing databases for information, using top of the line software, and assessing digital data in order to build solid cases and comprehensive reports. Ask for information in regards to a given investigator’s experience with all of these things.

In the end, it almost always pays to hire an experienced professional when it comes to just about anything and background checks and private investigation situations are no exceptions. Look into your options today and get the job done right!

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You Know Companies Use Background Checks in their Hiring Process – But How Can YOU Use Background Checks in Your Daily Life?

Background Checks are designed for protection. Even in your personal life, using a background check to provide a sense of security to yourself and your family is sound advice. Don’t think you would ever need to use a background check? Think again! The following list may get you thinking!

1. Babysitters or Nannies – Your children are the most valuable people in your life. Making sure that the person you hire to watch them when you are not around is safe and reliable makes sense. You can check with previous employers for a good part of the information you need. Many teens also take a Red Cross Course in babysitting and you can ask if they have this certification.

If you are hiring a nanny through an agency, verify that they have run a criminal background check and ask for the results! You should also see that they have been certified in basic first aid and child CPR.

2. Home Health Care Providers – If you have elderly parents or anyone in need of a home health aide, knowing that those people have the certifications and training they need is crucial. Making sure they do not have any criminal record (especially anything to do with abuse or drug offenses) is also essential to the protection of those you love. The agency providing the health care worker should have run a background check containing this information. Make sure you know what they found before you allow them in your home.

3. Housekeeper or Maid Service – Do you really want the people that clean your home unsupervised to have a criminal record? At the very least you want to know what kind of job they do and if they are reliable. Check their references carefully and, if they are employed through an agency, check to see what you can expect in the event of any problems with the service.

4. Home Contractors or Handymen – Checking references of past customers may give you information on their skills and work habits. If they own their own business, checking with the Better Business Bureau or your local township offices for complaints and how they resolved them is good business.

5. New Roommate – While getting a new roommate rarely escalates into an incident like the one depicted in the movie “Single White Female”, checking out a potential new roommate is both practical and sensible. Do they have a criminal record? Do they pay their rent on time? You may not be able to access their financial records, but contacting their previous landlords or roommates is a good step. You can also check your county’s civil and federal court records to see if they have filed bankruptcy or been involved in litigations.

6. Renters and Tenants – Do you own any rental property? A vacation home you are thinking of renting? You need to take the necessary steps to protect both your property and ensuring the safety of your other tenants (if you have them) and your neighbors. A basic check of any criminal or civil actions against them is the first step. You should also check any past landlords to determine whether they pay their rent on time and if they left the rental property in good order.

These are just some suggestions on how you can use background checks to make you and your family safer, the additional peace of mind you will have is invaluable.

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The statistics are staggering. The latest National Retail Security Survey states that 45 percent of losses to retailers are attributed to theft by employees. The Association of Certified Fraud Examiners (ACFE) reports that 5 percent of revenues of a typical organization are stolen by company workers. The average internal fraud scheme goes undetected for 18 months. Small businesses are particularly vulnerable since they don’t have the resources or the processes in place to avoid and/or detect fraud activity.

With no formal loss prevention programs in place, many owners and managers rely on their experience and expertise to react to incidences of employees stealing. Others rely on their beliefs, perceptions and ideals that their employees would not steal from them for a number of reasons. The following are myths associated with those ideological thoughts:

My employees would not steal from me because …

1. They Like Me – While it is true that good relationships with the boss may deter a small percentage of employees from stealing, research has shown that dishonest employees are driven by a number of factors. Loss Prevention professionals cite the presence of the Theft Triangle as the breeding ground for employee theft. When these elements are present in the workplace, employees may be tempted to steal or become involved in other counterproductive behaviors.

Theft Triangle

Motive – Potential gain and use for the cash or product
Opportunity – Ability to quickly and safely steal the cash or product
Low Risk of Detection – Perception of low probability of getting caught

The employees may genuinely like the manager or owner, but if the three factors are present in the work environment, the temptation to steal may override friendship.

2. They’re My Best Employees – Many managers and employers perceive that because certain employees are self-motivated, hard workers, they do not have any integrity issues. They are above reproach simply because they exceed expectations in their performance. And because of that belief, those employees are not scrutinized for compliance to the rules, nor suspected of counterproductive behavior or theft. Without accountability to the rules, even the best of employees may take advantage and steal.

3. I Show That I Trust Them – It is essential that trust be developed throughout any organization. It is the foundation of every great relationship. In the world of business, the trust must be validated with accountability. Unfortunately managers and owners may interpret showing trust as not checking up on employees. Without a check and balance process or audit system, employees may perceive that there is low risk of getting caught. All incidences of employee theft violate trust. Show your employees that you trust them, but follow up on the performance expectations you have established.

4. They Have a Clean Background – Pre-employment background checks are significant in establishing a comprehensive loss prevention program. Hiring employees without criminal convictions may be a good start in creating an environment of honesty and trust. High integrity must permeate the organization. With a culture devoid of strong policies and procedures supported by compliance processes and effective supervision, employees may steal with a compelling motive, opportunity and the perception that they won’t get caught. The ACFE reports that of the 1,388 internal frauds investigated by Certified Fraud Examiners in the past year, 87 percent of them were perpetuated by first time offenders. They cited the lack of internal controls as the key factor in the crimes that triggered the criminal behavior.

5. I Pay Them a Higher Wage – Assumptions are made that paying employees a higher wage than their counterparts with other companies will make them happy. If employees are happy with their wages they won’t steal. It’s another myth. Sociological studies have shown that employees are influenced by the culture established by the work environment. Approximately 10 percent of the employees are morally incorruptible. They don’t bend or break the rules. They don’t steal given any opportunity to do so. Additionally, approximately 10 percent of employees bend and break policies and procedures with regularity and are prone to steal. They are the challenge of Human Resource personnel in medium and larger size businesses and a big problem for the smaller companies. The remaining 80 percent of the employee’s behavior in the workplace is influenced by the culture and attitudes. If the rules are clear and compliance is expected, employee behavior gravitates to following those rules. If the counterproductive behavior of the small percentage of the problem employees is not addressed and allowed to flourish, other employees will be influenced by that behavior. Ninety percent of the workforce can be positively influenced to compliant behavior with well written rules, clear expectations and effective follow-up.

We want to believe that employees won’t steal from us. We really do. We use these reasons to support our views. But, on their merits, these views are indeed myths. Sociological studies on workplace behavior, criminal investigations on employee fraud, and anecdotal stories have proven that the workplace environment must be controlled to avoid counterproductive behavior and theft. Policies and procedures must be well written. Compliance to the rules and behavior expectations must be clear. Internal controls must be established and audited. Counterproductive behavior must be addressed effectively, and the elements of the Theft Triangle must be eliminated. It must be known in the work environment that opportunities to steal are low and the probability of getting caught is high. You then might be right when you say; my employees won’t steal from me.

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Parents do everything they can to protect their children but if something horrible does occur, no parent is prepared to discover that they must not only deal with their grief, but they must also contend with the fact that their deceased child’s identity has been stolen.

According to Bloomberg.com, more and more parents have discovered that someone had stolen their child’s social security number directly from the government through the Social Security Administration’s on-line public Death Master File. The file is used by the agency to stop benefits for the deceased as well as to pay survivors for benefits that they may be due.

It has also become an ideal place for identity thieves to search for information they can use to file false income tax returns. Parents often don’t discover that their deceased child’s identity has been stolen until they file an income tax return. The IRS claims that as an agency they must carefully balance accuracy with the need to process returns efficiently. Once the IRS sends a refund, even if it is in response to a fraudulent return, the money is gone.

The same file also creates another problem by erroneously listing living individuals as deceased. This creates what is known as credit zombies. This is most often due to data entry errors which are easy to make but almost impossible to correct. Inspector General Patrick O’Carroll Jr. testified that from January 2008 to April 2010 more than 35,000 people were placed in credit limbo when they were declared dead in the system. This keeps these innocent people from opening bank accounts, obtaining loans or even getting a driver’s license renewed.

Lawmakers have heard from their constituents about identity fraud and error and are trying to change or limit access to the Death Master File as well create a more effective system for correcting errors. Chairman of the Senate Subcommittee on Fiscal Responsibility & Economic Growth, U.S. Senator Bill Nelson recently convened hearings on tax refund fraud as did a panel in the U.S. House of Representatives.

Until a legislative solution can be reached, the IRS is attempting to stem tax fraud identity thefts by flagging deceased taxpayer’s final returns and preventing any one else from using their Social Security numbers.

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