Stockton man sentenced to prison in connection with IRS tax fraud, ID theft scheme

A Stockton man was sentenced to two and a half years in prison in connection with a conspiracy to defraud the IRS involving identity theft.

Jeffrey S. Grady, 35, was ordered to pay $25,000 in restitution in addition to his prison term after allegedly submitting fraudulent tax returns that falsely claimed refunds, according to a news release issued by the U.S. Attorney’s Office for the Eastern District of California.

Jeffrey Grady was the last to be convicted out of four Stockton co-defendants believed to be involved in the scheme, according to the release.

He and the others were accused of stealing names, Social Security numbers and other identifications from people in order to submit tax returns under their names, according to the release.

“The harm caused by Mr. Grady and his co-defendants goes beyond simply cheating the government,” IRS Criminal Investigation Special Agent in Charge Kareem Carter said. “Stealing identities and filing false tax returns is a serious crime that has a devastating impact on the victims.”

Jeffrey Grady alone is believed to have submitted at least 150 fraudulent tax returns, requesting about $94,140 in returns of which the IRS paid out more than $25,000, according to the release.

Co-defendant Christopher Grady was sentenced in July 2017 to 38 months time served and was fined $250,000.

Jacob Cook was sentenced in September 2017 to 30 months in prison and was fined $69,000.

Tosh Babu was sentenced in September 2017 to 30 months in prison and was fined $94,000.