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Marion County Sheriff via AP
Krystle Marie Reyes, 25, is accused of tax evasion, theft, computer crime and methamphetamine possession.
PORTLAND, Ore. -- An Oregon woman was charged Wednesday with duping the state into giving her a $2.1 million tax refund that allowed her to go on a short-lived spending spree — an alleged scam that has prompted embarrassed state revenue officials to review how they process tax returns.
Krystle Reyes, 25, of Salem, filed an electronic return in January via Turbo Tax, reporting erroneous earnings of $3 million, authorities said. Her request for a $2.1 million refund was initially red-flagged by an automated system, but a subsequent manual review by Oregon revenue department workers OK'd the refund. Turbo Tax then loaded the full amount onto a debit card for Reyes.
Authorities say she spent $150,000 of the funds before reporting the card lost or stolen, at which point the ruse was discovered. The state has recovered roughly $1.9 million of the funds.
Reyes was arrested June 6, and now faces eight felony charges. In addition to tax evasion and theft charges, she is accused of computer crime and methamphetamine possession. She is scheduled to be arraigned on July 5.
Attempts by The Associated Press to reach Reyes, who is no longer in custody, have been unsuccessful and it was not clear if she has an attorney. Officials also have not released the allegedly falsified tax return because of confidentiality laws pertaining to tax matters.
Andrew Campbell, a senior assistant attorney general who filed the charges, has not responded to AP's requests for interviews.
A list of what Reyes purchased during the spending spree has not been provided, but police said video surveillance showed her swiping the debit card at various stores in the Salem area. Despite being a millionaire for a few months, Reyes paid $2,000 cash to buy a 1999 Dodge Caravan, the vehicle she had been seen driving in the month before her arrest.
'Human error'
The Revenue Department, which processes $7 billion in tax returns, is understaffed because of budget cuts and has an old computer system. But agency spokesman Derrick Gasperini said neither of those issues was to blame for what he described as a "human error."
The agency plans to release more details about its apparent blunder in the coming days, and how it plans to prevent a recurrence. There has been no evidence linking Reyes to anyone inside the agency, but officials want to make sure its internal controls limit the possibility of collusion.
"Catching this one, we all are concerned — here at the agency as well as the public — about 'is this part of a larger scheme, and who's involved in that larger scheme and does it involve anyone inside our walls?" Gasperini said.
State Sen. Ginny Burdick, D-Portland, the chairwoman of the Senate Revenue and Finance Committee, has said she plans to hold a hearing on the matter this summer.
"I'm not on a witch hunt, but I'm just very, very concerned that something this flagrant could have gotten through the process," she said. "We need to understand why it happened and what is going to be done differently."
State Rep. Vicki Berger, R-Salem, co-chair of the House Revenue Committee, told the Oregonian when Reyes was arrested that the revenue department "had some explaining to do."
"Is this is an anomaly? If so, let's make sure it never happens again," she said. "Or do we have a systematic problem in the way the Department of Revenue treats this and other transactions?"
Following the arrest, the agency reexamined the returns of 108 people who received a refund of at least $50,000 during the current processing season, and no new instances of fraud were uncovered.
According to the Oregonian, the state reported $559 million in delinquent taxes in 2010, primarily from unpaid personal and corporate income taxes.
The Associated Press contributed to this report.
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Leave a Comment:
Good old Oregon where if your a wetback or illegal then the state will give you anything you want. They will probably give her a job now so she can run the state motorpool. I worked for the Feds and the State of Oregon and if you're a spick then everything including housing is given to you. Good old democrats love the welfare ranks.
U work for the fed and state and u use words like spick and wetback. What's wrong with that picture.
This woman is a low life, bottom feeding, fat, ugly piece of hispanic scum.
Sounds like the majority of them.
Lynnial,
u've already proven you're a bigot. U don't have to keep reinforcing it.
(Following the arrest, the agency reexamined the returns of 108 people who received a refund of at least $50,000 during the current processing season, and no new instances of fraud were uncovered) There we go trying to hide the fact that they screwed up big time looking to show there on top of it...lol...what a bunch of fuging morons! Now they will come after me for calling them MORONS!
Chuck, and do you KNOW how much income you have to have to get BACK $50K? At the STATE level?'
I suppose that someone now is going to try to claim that in the bluest state out there that those must all be PUBS.
(LOL--any GOOD pub would have done their withholdings better. No money in giving the free loan to the state.
Understaffed / Old computer system , How about the real reason this tax refund got processed LAZY , STUPID , INCOMPETENT government workers. How about the smarter fraud cases that will never be discovered being they allowed this refund (That was screaming fraud all over it)to be processed. Myself and any body else outside the government would be FIRED for far less of poor job performance.
Fat and stupid is no way to go through life. She lost the card and reported it stolen to the authorities!! That's hilarious! She bought a 1999 Dodge Caravan! Wow!! This story just gets better and better.
Tom B--would YOU take a 'debit card' as payment for even a $2000K vehicle?
Wow.
Didnt know Jabba the Hut had a sister
I get that hundreds of little omissions or fraudulent ID's could slip by with the volume at tax season, and that the machine did flag this, but how did the actual eyes of an auditor let it through for payment?!! The poverty stricken economy could lose 1.5 mil and nobody so much as calls this pizza-faced, morbidly obese-greasy haired- trailer trash with no W-2 to back up the amount to find out why, or delays the payout with request to fill out forms or locate the paperwork which indicates the taxes already paid that need returning? I paid a penalty last year because the amount withheld was ever so slightly lower - -$200 or the like, than what I wound up paying - -in spite of some elective extra being added out of every paycheck! The overzealous system that poked me and put some employee on mailing the bill and someone else opening the return envelope and entering things in databases sees to it that that sucking hole of low level crimes gets money. Behold the face of future America: "I won't work at difficult jobs I don't want, eat like a pig assisted by food stamps and need medical help, unemployed, maybe launch a scam, and collect from Welfare - -maybe SSI for my fat *ss!"If you can subsidize your gimme-gimme--take children (who think they can sing and dance singing off key with an i-pod in their ears wearing hop hop costume or done up like a Jerseylicious Princess or Goth garbage can) for the rest of your and their lives, go ahead and have and fund the little "succubi". If not, please don't foist them on me or vote in other horrible people's back breaking, lazy, over-spenders for subsidies. This "blob" is what you get with that policy!
fun mom--absolutely. And if your income fluctuates by more than a certain amount, your return is flagged by a computer, so one would THINK the next logical thing for that employee at the Oregon DOR to do is 'call up her previous year's return.
And send out a letter demanding documentation.
What?
Next year a very big increase in Turbo Tax users !! Now if they all do what she did , and cash them out and split with the dough !! We'd really be in deep doo doo !! Way to go IRS aces !!
Not to defend the IRS, but this was NOT them--it was OREGON's Department of Revenue.
They should lock her up and make her pay back the $150,000 she managed to spend so wisely (a minivan?). I hear making license plates in a prison pays well. An how do you get a 70% tax return?
LOL - This woman is smarter than the government.
And she sure doesn't look too bright.
Time for a name change :
United States of Welfare / Welfare States of America / United Welfare of America
FN Welfare Rats - Nothing to do and all day to do it.
If you work for the Oregon Government there is no such thing as an honest mistake. All they employ is uneducated idiots, mostly Mexicans because they are bilingual. I worked for the Oregon State Government DHS and have never seen so much waste or mistakes in my life. They hired a 20 yr old girl as a casemanager for people on foodstamps and state medical, she had no experience at all. She had no common sense but could speak spanish so she was hired at a higher rate of pay. I guess that was so she could speak to the greasballs in their native tongue so as to know how much services they wanted to steal form the govermment. Its just a fact of life if you want to live like a king in Oregon then you better be a SPICK.
I know that this is against the rules....but look at her!
Momaid-What do you think caused the financial mess we are in? Yes nobody forces anyone to invest. However, legal but unregulated risk that a couple of these so called "too big to fail" takes can directly affect our economy. I am not in anyway condoning what this lady did, we are also being ripped off by these big banks and oil companies. Do you realize that the government still subsidize oil in this country? Do you know how much write-offs these big banks and oil get? Do you realize that they get big tax break for being the so-called "job creators?" Do you know who is paying for your super-pacs? Republicans and democrats I don't care! My point is we are sitting here being outraged by this one stupid crime when we are being robbed by politicians and big business with pen and paper everyday. Middle class in America is slowly becoming extinct and the so -called 1% hasn't grown to 2%. Where do you think that number is tipping to? poverty! And btw this didn't happen eight or 15 years ago. it has been going on. And we the masses are so stuck in our politics and race bating that we don't want to open our eyes. This is not a white, black or "Mexican" issue. It is an American issue. All races are suffering and you have only a few out there prospering. Are you saying the rest of us are lazy? I am all for business and I have my own business but selected few with politicians in their pocket are rigging the system. It is called "white collar crime". We all should be outraged about that.
Bingo, well said!
Soooo sad, this world of ours is falling apart from every angle, dishonesty, incompetence, entitlement. I am truly afraid of our future and the cesspool we are creating! :(
Evidently not a penny of the $150k was spent on her beautification. Interestingly enough you can fix ugly but not stupid.
This woman has to qualify for worlds dumbest criminal. 2.1 million and over a couple months she only spent 150K. Wow, a smart crook would have had passport ready, flew to a safe country and downloaded that card, and then gone off into obscurity, happily for the rest of her life.
What an honest looking mugshot..haha..
So that's how u justify it. It's in your genes to be a savage.