Tax fraud ring leader, ex-USD player pleads guilty
SIOUX FALLS, S.D. (AP) — A former University of South Dakota football player who recruited students and others to steal identities and fraudulently collect hundreds of thousands of dollars in tax refunds pleaded guilty Thursday nearly two years after they were indicted.
Alphonso “Rico” Valdez, 23, of Tampa, Florida, faces a maximum sentence of 10 years in prison and a $250,000 fine for one count of conspiracy to defraud the U.S. and a mandatory two-year sentence for aggravated identity theft.
Prosecutors accused Valdez and 10 other people of stealing people’s identities and filing bogus income tax returns showing about $1.1 million in refunds due. The Internal Revenue Service paid fraudulent claims of more than $400,000 before the scheme was uncovered.
Under questioning by U.S. District Judge Karen Schreier, Valdez said he was not forced into participating in the ring. Valdez told Schreier he began attending drug education classes 10 months ago after he tested positive for marijuana.
Valdez is now a senior studying health science at Tennessee State University. He told the court his goal is to become a high school football coach and show children that they can “further their education” despite mistakes they may have made.
Seven of the 11 people have ties to USD. Six, including Valdez, played for the school’s football team. Another former student was part of the track and field team and student body president.
The ring was indicted in 2012.
Court documents show Valdez recruited students at USD and people he knew in Tampa to gather names, addresses and other identifying information, and used that information to file the fraudulent tax returns.
The scam was discovered when Valdez used preloaded debit cards to withdraw $900 in cash from an ATM in Vermillion, South Dakota. Valdez tried to hide his identity by wearing sunglasses and a stocking cap. That led investigators to a USD dorm room, where authorities said they found evidence of fraud that started a months-long investigation.
Valdez’ co-defendants: Charlie Adams, 23, Raunta Ellison, 25, Melissa Dinataly, 24, Dametrius Turner, 23, Jeremy Blount, 25, Christopher Lundy, 23, Christopher Frierson, 23, Nathan Singletary III, 24, all from Tampa; Terry Liggins, 29, of Omaha, Nebraska; and Marquis Butler, 24, of Los Angeles.
Schreier allowed Valdez to remain free until the sentencing hearing scheduled for Jan. 12.