New Mexico tax unit leader believed to have stolen about $1.2M, sentenced to 8 years - Albuquerque Journal

New Mexico tax unit leader believed to have stolen about $1.2M, sentenced to 8 years

U.S District Attorney Alex Uballez, left , listens as U.S Assistant Jeremy Pena talk about the sentencing of former New Mexico Taxation and Revenue employee George Martinez . Photographed on Wednesday January 25, 2023. (Adolphe Pierre-Louis/Albuquerque Journal)

A former high-ranking official with the New Mexico Taxation and Revenue Department — who led a unit that examined questionable refunds — was sentenced to nearly eight years in prison for his own scheme to steal tax money.

George Martinez, 46, was handed down the sentence in federal court in Albuquerque on Wednesday. He pleaded guilty to more than 90 counts of wire fraud, money laundering and identity theft for shifting improper tax refunds into his own accounts. He was taken into custody after the hearing to begin a 94-month sentence, followed by three years of supervised release.

Martinez, a former unit supervisor and bureau chief of the Questionable Refund Unit, admitted in court documents to funneling around $690,000 in tax dollars to different bank accounts he controlled.

Attorneys for Martinez could not be reached for comment Wednesday.

State tax and revenue officials said previously that the department launched an internal investigation into Martinez in 2018 and the case was then referred to the FBI. Martinez left the department that year and was arrested in March 2021.

“The services that the people of New Mexico deserve are funded by that system of tax collection,” Alex Uballez, U.S. Attorney for the District of New Mexico, said at a Wednesday news conference, “and so we will aggressively protect your tax dollars from fraud, especially when driven by the greed of a corrupt government official.”

Assistant U.S. Attorney Jeremy Peña, one of the prosecutors on the case, said Martinez’s position within the department allowed him to stay under the radar for the better part of a decade. Prosecutors said the fraud took place between 2009 and 2018.

“He was very familiar with the types of refunds that would trigger a red flag by the automated software that would do audits,” Peña said. “And it was eventually after many years of doing the conduct that there was an internal review that reviewed those safeguards and found his activity.”

Martinez wrote in his “admission of facts” that he changed taxpayer information — such as their Social Security numbers, bank account numbers and withholding amounts – and moved the tax returns and refunds into his accounts.

Prosecutors said Martinez used the Social Security numbers of 11 victims, including seven people who were dead and one with dementia. Martinez’s mother and twin brother were also victims in the scheme, according to court documents.

U.S. attorneys said it is believed he stole about $1.2 million from the state. He will be ordered to pay more than $1.2 million in restitution to the state of New Mexico, as well as a nearly $690,000 judgment, Peña said.

He has “little to show” for his crimes, prosecutors said, as much of the money was spent gambling at local casinos.

“Defendant’s actions have harmed the community of New Mexico. He rose to a position of trust in relation to the public coffers of the State of New Mexico,” Peña wrote in a sentencing memorandum. “He abused that trust and stole from every citizen whose money went into those coffers. He spent the money largely at casinos. He has little to show for living a life subsidized by fraud.”

Peña said the Taxation and Revenue Department has made changes to prevent similar schemes in the future.

“The safeguards did improve, and that’s how he was eventually tripped up,” he said. “So, his patterns have been understood. The exact methods by which he was assigning refunds to himself are now well known. And they know what to look for.”

U.S. District Judge Kea W. Riggs presided over the case.

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