U.S. Treasury Check Fraud Ring Busted
OAKLAND — A federal grand jury has indicted Franchesca Calagui and Dondre Gray on charges of conspiracy to commit bank fraud and bank fraud. Calagui is also charged with receipt of a U.S. Treasury check with forged endorsement or signature.
According to the indictment unsealed yesterday, from approximately May 2022 through March 2023, Calagui and Gray, both of Emeryville, Calif., allegedly conspired to obtain stolen U.S. Treasury checks, recruit others to fraudulently endorse or sign the checks, and give the checks to Calagui to cash for their personal benefit. During this period, Calagui was employed as a part-time associate banker at JP Morgan Chase Bank.
The indictment includes text messages between Gray and Calagui discussing the scheme, where Gray expressed concern about scamming a bank where Calagui worked, to which Calagui responded “I do not care if u scam us lmao.” Gray reportedly described using runners—individuals paid to enter banks with fraudulent checks, cash them, and return the proceeds to the operators of the scheme. The defendants are charged with attempting to cash at least 339 stolen U.S. Treasury checks totaling more than $850,000.
Acting United States Attorney Patrick D. Robbins, Special Agent in Charge Tyler Hatcher of the IRS Criminal Investigation (IRS-CI) Los Angeles Field Office, FBI Acting Special Agent in Charge Dan Costin, TIGTA Acting Special Agent in Charge Brandon Knarr, Special Agent in Charge Ryan Korner from the FDIC Office of Inspector General (FDIC-OIG), San Francisco Division Inspector in Charge Stephen M. Sherwood of the U.S. Postal Inspection Service (USPIS), Special Agent in Charge Dimitriana Nikolov with the Department of Veterans Affairs’ Office of Inspector General’s (VA OIG) Northwest Field Office, and Acting Special Agent in Charge Dean Lake of the Social Security Administration’s Office of Inspector General (SSA OIG) made the announcement.
Both defendants are charged with one count of conspiracy to commit bank fraud under 18 U.S.C. § 1349 and five counts of bank fraud under 18 U.S.C. §§ 1344(1), (2). Additionally, Calagui faces five counts of receipt of a U.S. Treasury check with forged endorsement or signature under 18 U.S.C. § 510(b). Calagui and Gray were arrested and made their initial appearances in federal district court yesterday. They are scheduled to appear before U.S. District Judge Yvonne Gonzalez Rogers on April 3, 2025, for a status conference.
An indictment alleges that a crime has been committed, and all defendants are presumed innocent until proven guilty beyond a reasonable doubt. If convicted, each defendant faces a maximum sentence of 30 years in prison and a fine of $1,000,000 on each charged count. Any sentence following conviction would be determined by the court, considering the U.S. Sentencing Guidelines and the federal statute governing sentencing, 18 U.S.C. § 3553.
Special Assistant United States Attorney Cynthia Johnson is prosecuting the case, assisted by Amala James. The prosecution results from an investigation by the IRS-CI, FBI, TIGTA, FDIC-OIG, USPIS, VA OIG, and SSA OIG.
IRS-CI conducts financial crime investigations, including tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, and identity theft. IRS-CI special agents are the only federal law enforcement agents authorized to investigate violations of the Internal Revenue Code, achieving a 90% federal conviction rate. The agency has 20 field offices across the U.S. and 14 attaché posts abroad.
IRS Special Edition Tax Tip 2013-08: Protect Yourself from the Dirty Dozen Tax Scams
The IRS’s annual ‘Dirty Dozen’ list includes common tax scams that often peak during the tax filing season. The IRS recommends that taxpayers be aware so they can protect themselves against claims that sound too good to be true. Taxpayers who buy into illegal tax scams can end up facing significant penalties and interest and even criminal prosecution.
The tax scams that made the Dirty Dozen list this filing season are:
Identity Theft. Tax fraud through the use of identity theft tops this year’s Dirty Dozen list. Combating identity theft and refund fraud is a top priority for the IRS. The IRS’s ID theft strategy focuses on prevention, detection and victim assistance. During 2012, the IRS protected $20 billion of fraudulent refunds, including those related to identity theft. This compares to $14 billion in 2011. Taxpayers who believe they are at risk of identity theft due to lost or stolen personal information should immediately contact the IRS so the agency can take action to secure their tax account. If you have received a notice from the IRS, call the phone number on the notice. You may also call the IRS’s Identity Protection Specialized Unit at 800-908-4490. Find more information on the identity protection page on IRS.gov.
Phishing. Phishing typically involves an unsolicited email or a fake website that seems legitimate but lures victims into providing personal and financial information. Once scammers obtain that information, they can commit identity theft or financial theft. The IRS does not initiate contact with taxpayers by email to request personal or financial information. This includes any type of electronic communication, such as text messages and social media channels. If you receive an unsolicited email that appears to be from the IRS, send it to phishing@irs.gov.
Return Preparer Fraud. Although most return preparers are reputable and provide good service, you should choose carefully when hiring someone to prepare your tax return. Only use a preparer who signs the return they prepare for you and enters their IRS Preparer Tax Identification Number (PTIN). For tips about choosing a preparer, visit www.irs.gov/chooseataxpro.
Hiding Income Offshore. One form of tax evasion is hiding income in offshore accounts. This includes using debit cards, credit cards or wire transfers to access those funds. While there are legitimate reasons for maintaining financial accounts abroad, there are reporting requirements taxpayers need to fulfill. Failing to comply can lead to penalties or criminal prosecution. Visit IRS.gov for more information on the Voluntary Disclosure Program.
“Free Money” from the IRS & Tax Scams Involving Social Security. Beware of scammers who prey on people with low income, the elderly and church members around the country. Scammers use flyers and ads with bogus promises of refunds that don’t exist. The schemes target people who have little or no income and normally don’t have to file a tax return. In some cases, a victim may be due a legitimate tax credit or refund but scammers fraudulently inflate income or use other false information to file a return to obtain a larger refund. By the time people find out the IRS has rejected their claim, the promoters are long gone.
Impersonation of Charitable Organizations. Following major disasters, it’s common for scam artists to impersonate charities to get money or personal information from well-intentioned people. They may even directly contact disaster victims and claim to be working for or on behalf of the IRS to help the victims file casualty loss claims and get tax refunds. Taxpayers need to be sure they donate to recognized charities.
False/Inflated Income and Expenses. Falsely claiming income you did not earn or expenses you did not pay in order to get larger refundable tax credits is tax fraud. This includes false claims for the Earned Income Tax Credit. In many cases the taxpayer ends up repaying the refund, including penalties and interest. In some cases the taxpayer faces criminal prosecution. In one particular scam, taxpayers file excessive claims for the fuel tax credit. Fraud involving the fuel tax credit is a frivolous claim and can result in a penalty of $5,000.
False Form 1099 Refund Claims. In this scam, the perpetrator files a fake information return, such as a Form 1099-OID, to justify a false refund claim.
Frivolous Arguments. Promoters of frivolous schemes advise taxpayers to make unreasonable and outlandish claims to avoid paying the taxes they owe. These are false arguments that the courts have consistently thrown out. While taxpayers have the right to contest their tax liabilities in court, no one has the right to disobey the law.
Falsely Claiming Zero Wages. Filing a phony information return is an illegal way to lower the amount of taxes an individual owes. Typically, scammers use a Form 4852 (Substitute Form W-2) or a “corrected” Form 1099 to improperly reduce taxable income to zero. Filing this type of return can result in a $5,000 penalty.
Disguised Corporate Ownership. Scammers improperly use third parties form corporations that hide the true ownership of the business. They help dishonest individuals underreport income, claim fake deductions and avoid filing tax returns. They also facilitate money laundering and other financial crimes.
Misuse of Trusts. There are legitimate uses of trusts in tax and estate planning. But some questionable transactions promise to reduce the amount of income that is subject to tax, offer deductions for personal expenses and reduced estate or gift taxes. Such trusts rarely deliver the promised tax benefits. They primarily help avoid taxes and hide assets from creditors, including the IRS.
For more on the Dirty Dozen, see IRS news release IR-2013-33.
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