A Līhu‘e woman pleaded guilty to fraud and theft offenses in federal court on Tuesday, July 20.
Forty-nine-year-old Leihinahina Sullivan appeared before Chief United States District Judge J. Michael Seabright where she pleaded guilty to three counts of wire fraud and one count of aggravated identity theft related to multiple long-running fraudulent schemes. Sentencing is scheduled for Dec. 2, 2021.
“Sullivan’s fraud was wide-ranging and lasted for years,” stated Acting United States Attorney Judith A. Philips. “Her web of lies and manipulation ends with this case. She will be held accountable for the damage she caused by her fraudulent schemes and the money she stole from friends, family, individuals in her community, and public and private institutions.”
According to court documents, Sullivan devised a tax fraud scheme, beginning as early as Jan. 31, 2011, through at least Aug. 23, 2017, to obtain tax refunds from the IRS and the State of Hawai‘i that she and the other individuals were not entitled to receive by filing false returns for herself and for others.
The false federal and state tax returns included fictitious expenses, claims for credits, and other items Sullivan knew were false when made. Sullivan did not review these tax returns with the individuals before she filed the tax returns in their names.
Sullivan transferred the fraudulent tax refunds into several bank accounts that she had access to and controlled, including her personal bank accounts and those of friends and family members, and a non-profit entity that she controlled. Sullivan then spent these tax refunds on personal expenses for herself, her family, and her friends.
The second scheme involved educational fraud and began Jan. 8, 2011 and lasted through at least Feb. 1, 2017. For college-bound students, Sullivan prepared and submitted false student loan, grant, scholarship, and financial aid applications and documents that requested money from public and private educational-based financial assistance and aid providers.
Sullivan transferred some money from students’ financial aid applications to her personal bank accounts and other bank accounts she controlled, then spent the money on her own personal and other expenses, such as for home construction, retail purchases, and her bills.
In the last fraud scheme Sullivan used personal identification information of many individuals, such as social security numbers and birth dates, to apply for and use credit cards in other peoples’ names without their authorization. In one instance, she submitted an electronic credit card application for an individual whom she knew died on the same day she sent in the application.
Sullivan faces a maximum penalty of 20 years imprisonment and a fine of not more than $250,000 as to each of the three counts of wire fraud, and a mandatory sentence of two years in prison in addition to any other sentence imposed by the court and a fine of up to $250,000 on aggravated identity theft when she is sentenced. Chief Judge Seabright will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
“Sullivan admitted to defrauding her community and taking money from taxpayers, students, and financial institutions for her own personal profit,” said Acting Special Agent in Charge Corinne Kalve of IRS-CI. “This guilty plea is a reminder that IRS-CI will continue to follow the money and investigate those who prey on their communities.”