Thomas Addaquay Sentenced to 12 Years in Prison for $7 Million Tax Refund and Romance Scam Conspiracy

ATLANTA, GA (February 12, 2025) – A sophisticated, multi-layered fraud operation spanning several years and impacting victims across the United States has come to an end with the sentencing of Thomas Addaquay, 50, of Atlanta. Addaquay was handed a 12-year and six-month prison sentence, followed by three years of supervised release, and ordered to pay over $7 million in restitution after being convicted of 30 felonies related to a sprawling web of tax refund fraud, business email compromise (BEC) scams, and romance scams.

The sentence marks the culmination of a lengthy investigation and prosecution by federal and local law enforcement agencies, highlighting the growing threat of complex financial crimes that exploit both individual vulnerabilities and weaknesses in digital security.

A Web of Deceit: Unpacking Addaquay’s Multi-Million Dollar Fraud Schemes

Addaquay’s criminal enterprise operated on multiple fronts, demonstrating a calculated and ruthless approach to defrauding both the government and individual citizens. The schemes, which ran from at least 2011 to 2016 (and potentially longer, based on the ongoing nature of BEC and romance scams), can be broadly categorized into two main areas:

Stolen Identity Tax Refund (SIRF) Fraud:

This scheme formed the foundation of Addaquay’s operation. He illegally obtained the personal identifying information (PII) of numerous taxpayers, including their names, Social Security numbers, and dates of birth. This stolen data was then used to file fraudulent federal income tax returns, claiming significant refunds.

• How it Worked: Addaquay, or his co-conspirators, would prepare and submit tax returns using the stolen identities, often claiming inflated deductions or fabricating income to maximize the refund amount. The IRS, lacking real-time verification systems to cross-check every return against employer-reported data, would issue refund checks based on these fraudulent filings.
• The Scale of the Damage: The court determined that this aspect of Addaquay’s scheme alone resulted in a loss to the IRS exceeding $4 million. This figure represents thousands of fraudulent tax returns and a significant drain on public funds.
• Impact on Victims: Beyond the financial loss to the government, victims of identity theft often face years of bureaucratic hurdles and financial distress. They may experience difficulties filing their legitimate tax returns, receiving benefits, or even securing loans due to the damage to their credit history. The emotional toll of having one’s identity stolen and used for criminal purposes is also significant.

Business Email Compromise (BEC) and Romance Scams:

While the tax refund fraud scheme targeted the government, Addaquay’s BEC and romance scams preyed on the trust and vulnerabilities of individuals and businesses. These scams, often intertwined, relied on social engineering and digital deception to manipulate victims into transferring large sums of money.

• Business Email Compromise (BEC): BEC scams are a sophisticated form of cybercrime that targets businesses of all sizes. Addaquay’s operation involved the use of hacked or “spoofed” email accounts. Spoofing is a technique where an email is made to appear as though it’s coming from a legitimate source, such as a known vendor, client, or even a company executive.
  • The Process: Addaquay, or his associates, would gain access to a company’s email system (often through phishing attacks targeting employees) or create email addresses that closely resembled legitimate ones. They would then send emails to employees with financial authority, often impersonating a CEO or other high-ranking official, requesting urgent wire transfers for seemingly legitimate business purposes (e.g., paying an invoice, settling a debt). The urgency and apparent authority of the request often led victims to comply without proper verification.
  • Targeting: BEC scams are particularly effective because they exploit existing business relationships and trust. The attacker often researches the target company extensively, learning about their vendors, clients, and internal communication patterns to make the scam more convincing.
• Romance Scams: These scams exploit the emotional vulnerability of individuals seeking companionship online. Addaquay, using false identities and fabricated profiles on dating websites and social media platforms, would cultivate online relationships with victims.
  • The Grooming Process: The scammer builds trust and affection over time, often showering the victim with compliments and promises of a future together. They may create elaborate backstories, often involving fabricated hardships or emergencies.
  • The Financial Angle: Once the victim is emotionally invested, the scammer begins to request financial assistance. This may start with small amounts, gradually escalating to larger sums. Common pretexts include medical emergencies, travel expenses to meet the victim, or business setbacks. The victim, believing they are helping a loved one, sends money, often repeatedly.
  • Psychological Manipulation: Romance scams are particularly damaging because they exploit the victim’s desire for connection and love. The emotional betrayal can be devastating, leaving victims feeling ashamed, embarrassed, and financially ruined.
• Structuring Proceeds: Addaquay pleaded guilty to structuring the proceeds from these schemes. This involves breaking down large sums of money into smaller deposits to avoid triggering reporting requirements that banks have for transactions over a certain threshold (typically $10,000). This is a common tactic used by criminals to launder money and conceal the source of their illicit funds.

Combined Losses and the Scope of the Investigation

The combined losses from Addaquay’s BEC and romance scams exceeded $3 million, affecting victims across the country. The sheer scale and complexity of the operation required a coordinated effort from multiple law enforcement agencies.

The investigation was led by the Internal Revenue Service-Criminal Investigation (IRS-CI) and the United States Secret Service, with significant assistance from the Cobb County, Georgia, Sheriff’s Office. This collaboration highlights the importance of interagency cooperation in combating complex financial crimes that often cross jurisdictional boundaries.

• IRS-CI’s Role: IRS-CI specializes in investigating tax-related crimes, including identity theft and refund fraud. Their expertise in tracing financial transactions and analyzing tax data was crucial in uncovering the extent of Addaquay’s tax refund scheme.
• Secret Service’s Role: While traditionally known for protecting the President, the Secret Service also has a mandate to investigate financial crimes, including counterfeiting, fraud, and cybercrime. Their expertise in digital forensics and investigating BEC scams was essential in unraveling Addaquay’s online activities.
• Local Law Enforcement’s Role: The Cobb County Sheriff’s Office provided valuable assistance, likely in the form of local intelligence, surveillance, and arrest support. Local law enforcement agencies often have a deep understanding of their communities and can provide crucial on-the-ground support to federal investigations.

Statements from Law Enforcement Officials

The strong condemnation of Addaquay’s actions by law enforcement officials underscores the seriousness of his crimes and the commitment to protecting the public from financial fraud.

• Acting U.S. Attorney Richard S. Moultrie, Jr.: Emphasized the “millions in losses to the IRS and private citizens” and the “disruption” caused to the lives of “innocent taxpayers.” His statement highlights the dual impact of Addaquay’s crimes – harming both the government and individual victims.
• Special Agent in Charge Demetrius Hardeman, IRS Criminal Investigation, Atlanta Field Office: Focused on the “emotional and financial harm” inflicted on victims and reiterated IRS-CI’s commitment to “bringing to justice those who victimize others through fraudulent financial schemes.”
• Special Agent in Charge Frederick D. Houston, United States Secret Service Atlanta Field Office: Highlighted the Secret Service’s role in “safeguarding the United States’ financial and payment systems from criminal exploitation” and their commitment to “pursuing justice for victims of financial crime across the country.”

Conclusion: A Warning and a Call for Vigilance

The case of Thomas Addaquay serves as a cautionary tale. It demonstrates the sophistication and reach of modern fraud schemes and the devastating impact they can have on individuals and the financial system. It also highlights the importance of collaboration between federal and local law enforcement agencies in combating these complex crimes.

For the public, the message is clear: vigilance is paramount. Individuals and businesses must be proactive in protecting themselves from fraud by:

• Protecting Personal Information: Be cautious about sharing personal information online and be wary of unsolicited emails or requests.
• Verifying Email Requests: Always verify the authenticity of email requests for financial transactions, especially those involving wire transfers. Contact the purported sender through a known, independent channel (e.g., a phone number you have on file) to confirm the request.
• Being Skeptical of Online Relationships: Exercise caution when developing online relationships, especially if the person is reluctant to meet in person or starts asking for money.
• Monitoring Financial Accounts: Regularly review bank and credit card statements for any unauthorized activity.
• Reporting Suspicious Activity: Report any suspected fraud to the appropriate authorities, including the IRS, the FTC, and local law enforcement.

The fight against financial fraud is an ongoing battle. By staying informed, taking preventative measures, and working together, we can reduce the risk of becoming victims and hold criminals like Thomas Addaquay accountable for their actions.