Ex-tax shark Stephen Jake McGonigle is on the hook for a decade in the slammer after masterminding a con to fleece the IRS and several state treasuries out of a hefty sum north of a million bucks. This 67-year-old former Orange County resident orchestrated a complex tax fraud, duping the feds and an array of state governments into shelling out fraudulent tax refunds across the board, as reported by the U.S. Attorney's Office for the Central District of California.
Starting in 2013, McGonigle's scheming tactics included sending a crony abroad to Thailand for fake IDs, snatching victim identities to snag undetectable mailboxes and prepaid debit cards throughout Orange County, and further afield, to pocket illegal tax returns. With his tax prep know-how, honed over 10 years in SoCal, McGonigle finessed his way to direct the ill-gotten gains to bank accounts he and his posse of fraudsters tightly controlled.
The U.S. District Judge James V. Selna didn't mince words, hitting McGonigle with a 120-month sentence and piling on a restitution order worth over $1.2 million. To add to his woes, McGonigle's already posted $300,000 in bond cash that'll be docked from the restitutions he owes. His sticky-fingered escapades sought to grift more than $10 million from Uncle Sam and states alike, ultimately swindling a cool $1.23 million before his 2019 arrest.
This was no small-time operation; McGonigle had a band of co-conspirators, two already pleaded guilty, and are anticipating their dance with justice in coming months, according to federal prosecutors. The fraudster's digital tracks were traced back to IP addresses ping-ponging around Southern California, including McGonigle’s own digs and sundry office spaces rented under his name. Some digital footprints also led to an outfit in Costa Rica, where McGonigle and the company expanded their operations.
Investigators from the IRS Criminal Investigation Unit teamed up with Homeland Security Investigations and the United States Postal Inspection Service to untangle the web of deceit. Missouri's Department of Revenue and the U.S. Secret Service also played critical roles in backing the investigation. Assistant U.S. Attorneys Sue Bai and Colin Scott spearheaded the prosecution, securing the hefty sentence for McGonigle and the downward trajectory for his co-defendants.
