Last year I reported on the case of the misplaced tax refund. An Orange County, California women put in the wrong account number on her tax return. She used an account that she had closed years ago. However, Citibank reissued the account to one Stephen Reginald McDow. The woman wasn’t expecting a refund of $110. Rather, she was expecting $110,000. When the refund didn’t show up, she started investigating.
Mr. McDow had spent roughly 60% of the refund, and he told the unlucky woman what happened. When restitution never happened, she reported the theft to the local police. The Orange County District Attorney was going to prosecute the case. However, Mr. McDow pleaded guilty last week.
He got 60 days at the Orange County jail, 18 months of probation, and had to make restitution (which he has done).
As I mentioned when I first reported on this story, you can’t spend a tax refund that’s not yours. This has happened on a couple of occasions to my clients. I had one client receive a $1,500 check and another had over $10,000 incorrectly direct deposited into his account. Both returned the money and there were no other issues. If you instead elect to spend the money, you’re spending someone else’s money, be it the taxpayer who was expecting the refund or the tax agency that incorrectly sent it. That”s theft, and the local jail is likely no more comfortable than ClubFed.
Indeed, had Mr. McDow repaid this money when first contacted by the victim, all he’d be out is the money he should never have received. Instead, he gets 20 months to think this over.