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Tax identity thief gets record 27-year prison term

June 20, 2015

The wheels of tax justice continue to grind along, with federal law enforcement officials celebrating what is believed to be the stiffest jail term ever handed out in connection with tax fraud.

James Lee Cobb booking photo via Pinella County JailJames Lee Cobb, III (at left), a 37-year-old Tampa, Florida, resident was, sentenced last week to 27 years in federal prison for his role in a scam to claim more than $1.8 million in tax refunds that were filed for by using stolen identities. He pleaded guilty to the charges last December.

Stiffest tax fraud sentence ever: That sentence tops the 21 years self-proclaimed tax fraud queen Rashia Wilson received in 2013 and again earlier this year following an appellate court order that the length of the sentence be re-evaluated.

By besting tax crime royalty, Cobb’s 27-year jail term earns this week’s By the Numbers honor.

Court documents show that Cobb was part of a group that used more than 7,000 stolen names, dates of birth, and Social Security numbers to file false tax returns and open pre-paid debit cards. Beginning sometime in 2011 (the date’s not clear), Cobb and his co-conspirators filed false tax returns claiming approximately $3 million in refunds, almost $2 million of which was erroneously paid by the Internal Revenue Service.

In executing a search warrant at Cobb’s home, investigators recovered the lists and medical records used as part of the tax identity tax fraud scheme. Much of the victims’ personal information was stolen from healthcare facilities, including from the James A. Haley VA hospital.

Tax ID theft hot spot: Tampa has long held the dubious title as the country’s tax identity theft capital. And that city’s medical center for veterans apparently is a ground central for tax crooks. In September 2013, a volunteer at Haley was charged with stealing patients’ identities and, along with another man, of using the information to file fake income tax returns.

Other stolen IDs in Cob’s case came from Florida Hospital, formerly known as University Community Hospital; ambulance services in Virginia, Georgia, and Texas; a Tampa medical billing company; and court records. In addition, a number of deceased victims’ names were obtained from genealogy websites.

When Cobb finishes his almost three decades behind bars, Cobb also will face five years of supervised release. He also must come up with the $1.8 million stolen during the scheme.

I’m pretty sure that Cobb won’t make enough over the next 27 years at in-prison jobs to cover that amount, but the restitution order is part of his sentence. Just in case.

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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