Daniel G. Johnson was serving time at a prison near Tucson, Ariz., when he found a new way to make money from behind bars: He started ripping off Uncle Sam. The 28-year-old forger, who worked in the private prison’s library, sent fraudulent tax forms to the Internal Revenue Service seeking refunds of more than $200,000. Although tax schemes are rampant in Arizona’s correctional systems, Johnson’s case was exceptional because he was caught and prosecuted by the federal government, reports the Arizona Republic.
This year, IRS officials detected $68 million in false tax refund applications filed by 18,000 U.S. prisoners for the 2004 tax year. That accounted for more than one-seventh of all phony refunds nationwide. In Arizona, convicts were responsible for roughly half of the $600,000 in fraudulent claims detected by Department of Revenue investigators this year. Tax-scamming is a longtime pursuit of America’s prison denizens. But it has proliferated behind bars so much recently that congressional hearings were conducted during the summer to figure out how the system can be fixed.