Kauai Woman Indicted For Using A Non-Profit To Facilitate A Tax Fraud Scheme And Identity Theft

HONOLULU – Leihinahina "Jennifer" Sullivan, 45, of Lihue, Kauai, was arraigned Friday, February 24, on a 12-count indictment charging her with tax fraud and aggravated identity theft. The indictment charges Sullivan with eight counts of false claims, two counts of wire fraud, and two counts of aggravated identity theft. Sullivan pled not guilty to all charges, and her trial was set for April 25, 2017, before Chief United States District Judge J. Michael Seabright.

Florence T. Nakakuni, United States Attorney for the District of Hawaii, said that according to allegations in the indictment, from at least January 2011 through January 2017, the last year of which is the current tax filing season, Sullivan engaged in a scheme to defraud the IRS and the State of Hawaii by submitting false tax returns seeking refunds on behalf of other individuals. The tax returns contained false items such as the filing status, dependents, Schedule A expenses including medical and charitable donations, unreimbursed employment expenses, and claims for credits such as child care and the Earned Income Tax Credit.

The indictment alleges that Sullivan concealed her acts from the taxpayers, by not reviewing the returns with them before filing, and by using her email addresses as a point of contact with the IRS and State. Sullivan also directed that tax refunds be deposited into bank accounts of the Mobile Native Hawaiian Health ("MNHH"), a non-profit entity of which she held various positions including director, or into other accounts which she controlled. In some instances, when individuals requested copies of their filed returns, Sullivan provided those individuals with copies of returns that did not match the returns that she actually filed, including changing the direct deposit information. The copies did not include the false items, the same direct deposit information, or the inflated false refund amounts.

For the aggravated identity theft charges, the indictment alleges that Sullivan used an individual’s name, Social Security number, and signature, without that person’s authorization, to file State of Hawaii tax returns for 2010 and 2011.

The charges in the indictment are merely accusations, and the defendant is presumed innocent until proven guilty. If convicted, Sullivan faces a maximum term of imprisonment of up to 20 years for each wire fraud count, up to five years imprisonment for each false claims count, and a mandatory minimum term of imprisonment of two years for each aggravated identity theft count.

The case was investigated by IRS-Criminal Investigation with assistance from the Kauai Police Department and the State of Hawaii Department of Taxation, and is being prosecuted by Assistant U.S. Attorney Rebecca A. Perlmutter.

# # #