The CID may not always get its man (or woman), but we do get quite a few. Here are some recent examples:
Inalbys Lopez-Estrada, 36 and Ana Marys Tapanes-Iglesias, 34 both of Houston, pleaded guilty in a Harris County district court in December to illicit motor fuel transportation. In lieu of 10-year suspended prison sentences, they each were placed on three years’ probation, fined $1,000 and ordered to pay court and related costs.
The co-defendants admitted transporting motor fuel without a cargo manifest, a second-degree felony punishable by two to 20 years in prison and up to a $10,000 fine.
In September 2018, police arrested the duo in Katy for allegedly transporting diesel fuel without proper documentation in a vehicle designed to receive, transport and dispense motor fuel.
After observing the covered bed of the women’s pickup truck, police followed it to a local restaurant and initiated contact with the defendants. Upon detecting a strong diesel fuel odor, an officer conducted a consensual search of the vehicle. Concealed beneath the truck bed was an auxiliary fuel “bladder” connected to a hose, nozzle and auxiliary pumps. The women did not have the requisite documentation to transport fuel on a public roadway.
CID assisted the Katy Police Department in the investigation of this case. It grew out of the defendants’ alleged ongoing use of re-encoded (“cloned”) credit/debit cards containing fraudulently acquired account information to obtain and transport large quantities of diesel fuel without paying taxes.
Yexis A. Benavides Estrada, 25, of Houston pleaded guilty Nov. 20 in a Harris County district court to an unlawful motor fuel transaction and received six years’ probation in lieu of a suspended 10-year prison sentence.
The defendant also must perform 120 hours of community service, pay more than $700 in restitution and undergo drug testing.
Benavides Estrada admitted using a re-encoded charge card to unlawfully obtain and transport more than 100 gallons of diesel fuel worth almost $300 from a Katy convenience store in November 2018. He was convicted of engaging in a motor fuel transaction without a permit, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine.
A Katy police detective caught him after he made three transactions using a "cloned" discount store gift card containing superimposed credit card information. The fuel was pumped into a large auxiliary tank in a flat-bed truck modified to receive, transport and dispense motor fuel.
Officers confiscated 23 cloned cards during the arrest. A related felony credit card abuse case was dismissed in the plea agreement.
CID assisted the Katy Police Department in the investigation of the motor fuel tax fraud case.
Luis Perez Delarosa, 22, of Houston pleaded guilty Oct. 4 in a Harris County district court to an unlawful motor fuel transaction and was sentenced to two years in prison. He was credited with 221 days’ jail time served.
Delarosa admitted to engaging in a motor fuel transaction without a permit, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine.
In July 2018, the defendant was observed at a Houston gas station obtaining fuel for his pickup truck using multiple charge cards. Local police apprehended him and confiscated 24 re-encoded credit cards.
Officers discovered that the truck had been modified to contain a large auxiliary fuel tank with hoses and nozzles consistent with transporting motor fuel. Delarosa did not possess the requisite state permits.
CID assisted the Houston Police Department in the investigation of the case.
Luis Moreno Lopez, 51, of Houston pleaded guilty in August in a Brazoria County district court to an unlawful motor fuel transaction and was sentenced to six years’ probation, 120 hours of community service, a $500 fine and $318 in court costs.
He also must pay for and attend an anti-theft class. He was credited with 168 days’ jail time served.
Moreno Lopez admitted to engaging in a motor fuel transaction without a permit, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine. Two related felony charges were dropped.
Last March, an employee observed the defendant using re-encoded credit cards to obtain diesel fuel at a chain convenience store in Pearland. Local police responded and arrested him and three other suspects during a subsequent traffic stop.
In the bed of their pickup truck, officers discovered a large auxiliary fuel tank outfitted with hoses and nozzles consistent with transporting motor fuel. Moreno Lopez did not possess the requisite state permits.
CID assisted the Pearland Police Department in the investigation of the case.
Robert Wayne Reaves, 49, of Wills Point pleaded guilty June 10 in a Kaufman County district court to a tobacco tax violation and was sentenced to 30 days in jail, a 10-year prison term probated to four years and a $1,500 fine, plus $420 in court costs and 120 hours of community service.
Reaves admitted possessing tobacco products on which more than $50 in taxes were owed, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine. He was under indictment for allegedly scheming to resell untaxed pipe tobacco purchased online from out of state without paying substantial amounts of Texas tobacco tax.
Investigators found more than 1,600 ounces of illicit tobacco at Reaves' tobacco shop in Terrell in the fall of 2017.
In an unrelated drug case, Reaves’ probation ordered in 2014 was revoked based on his plea in the tax case. He previously had admitted possessing more than 50 pounds of synthetic cannabinoids in 2012, a second-degree felony punishable by two to 20 years in prison and up to a $10,000 fine.
Reaves had received deferred adjudication which has now been rescinded, giving him two felony convictions. He was given the same sentence on the drug charge and will serve them both concurrently.
James Carter DeCamara, 53, of Anson pleaded guilty May 29 in a Travis County district court to a probation violation and was sentenced to two years in prison plus more than $54,000 in previously ordered restitution upon parole. He is being credited with 149 days’ jail time served.
DeCamara admitted to a $1,200 delinquency on tax restitution payments to the state ordered in 2008 when he pleaded guilty to motor fuel tax evasion. He also had been jailed for 120 days, fined $2,000 and given 10 years’ probation, which has now been revoked.
The offense is a second-degree felony punishable by imprisonment for two to 20 years and a fine of up to $10,000.
In 2006, DeCamara was caught using red-dyed diesel fuel in several trucks he owned and operated on public roadways. He avoided paying motor fuel taxes by purchasing dyed diesel fuel tax free with a permit.
DeCamara gave a distributor a signed statement attesting that none of the untaxed diesel fuel would be used in a taxable manner, i.e., in motor vehicles on public roadways. Untaxed diesel is dyed red and may be used lawfully off road or in agricultural equipment only.
Yasser Izquierdo-Hernandez, 30, of Houston pleaded guilty May 17 in a Colorado County district court to motor fuel tax evasion and was put behind bars for using a peace officer’s charge card to commit the crime.
The defendant received deferred adjudication (no final conviction), 30 days in jail (to be served on weekends), five years’ probation and 240 hours of community service. He also was ordered to pay a $1,500 fine and restitution to be determined, plus court costs and other related fees.
Izquierdo-Hernandez admitted to a second-degree felony punishable by imprisonment for two to 20 years and a fine of up to $10,000. He waived indictment and pled to a charge contained in a legal document called a felony information.
Dismissed in the plea agreement was a related charge of engaging in a motor fuel transaction without a license, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine.
In a separate case brought by local authorities, Izquierdo-Hernandez pleaded guilty to felony credit/debit card abuse, also receiving deferred adjudication, five years’ probation, 120 hours of community service and a $250 fine plus court costs and related fees. He could have received from six months up to two years in a state jail and been fined up to $10,000.
He also was given 22 months to earn a high school diploma or the equivalent as a condition of his probation.
Izquierdo-Hernandez was arrested last December for using a re-encoded gift card belonging to a Fort Worth police detective to unlawfully obtain 138 gallons of diesel fuel worth more than $368 at a Weimar truck stop.
The detective’s bank had texted him that his card number was in use there. The detective then alerted Weimar police that an unauthorized transaction was in progress, leading to Izquierdo-Hernandez’ arrest at the scene. Investigators recovered numerous “cloned” cards containing fraudulent charge account information.
Alexander Tamayo-Cabrera, 31, of Austin pleaded guilty in a Travis County district court in April and was sentenced to two years in prison for using a re-encoded gift card to unlawfully obtain a large amount of diesel fuel, almost injuring a lawman in the process. He also was assessed court costs.
Tamayo-Cabrera admitted transporting motor fuel without a shipping document, a second-degree felony punishable by two to 20 years in prison and up to a $10,000 fine; and evading arrest in a motor vehicle, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine.
Three other charges pending against him – motor fuel tax evasion, a second-degree felony, assaulting a public servant and tampering with physical evidence, both third-degree felonies – were dismissed in the plea agreement.
In September 2017, Tamayo-Cabrera took 105 gallons of diesel fuel worth almost $264 from a North Austin convenience store , concealing it in an auxiliary tank hidden in the bed of his pickup truck.
When confronted by a Comptroller investigator, he sped away in the truck. The officer stepped onto its running board to avoid being pinned between the vehicle and a fuel pump and was thrown to the ground. As he fled the scene, Tamayo-Cabrera threw “cloned” charge cards out the driver’s side window, according to reports.
The Austin Police Department assisted CID in apprehending the suspect.
Mark Anthony Juarez Jr., 35, of Houston was sentenced in late October in a Harris County district court to five years in prison for using re-encoded charge cards to unlawfully obtain large quantities of diesel fuel for resale last spring.
Juarez also was convicted of two felony weapons possession charges one from 2016, for which he was on probation, and another that occurred in April. He received five-year prison sentences for each of those convictions as well. He will serve all of them concurrently in the Institutional Division of the Texas Department of Criminal Justice.
A related evading arrest case was dismissed in the plea agreement.
On April 26, at one of the service stations Juarez had been frequenting in northwest Houston, the owner of a credit card used in his crimes recognized his vehicle from a surveillance photograph a store manager had shown him. He followed Juarez to another station, and, when Houston police arrived, an officer observed Juarez buying diesel fuel with cloned cards. During a subsequent attempted traffic stop, a brief chase ensued before Juarez was apprehended. Upon arrest, officers confiscated 10 fraudulent charge cards and a firearm from his vehicle.
Juarez pleaded guilty to transporting motor fuel without a license as well as being a felon in possession of a firearm. Both are third-degree felonies punishable by two to 10 years in prison and up to a $10,000 fine.
Juarez further admitted to illegally possessing a firearm as a felon in 2016, for which he had received deferred adjudication (no final conviction) and five years probation. That offense was based on a 2002 conviction for felony drug possession. In Texas, felons may possess firearms five years after they are convicted, but only at their residences.
Carlos Albert Viera-Rodriguez, 35, of Houston was sentenced on Oct. 29 in a Burleson County district court to four years in prison for using re-encoded charge cards to unlawfully obtain more than 330 gallons of diesel fuel from a Caldwell convenience store in April 2017.
He also was ordered to pay $200 in restitution plus court costs.
The defendant pleaded guilty to motor fuel tax evasion (failure to pay backup tax), a second-degree felony punishable by two to 20 years in prison and up to a $10,000 fine. He also pleaded guilty to three counts of credit/debit card abuse, a felony punishable by state jail confinement for six months up to two years. The 14-month sentence pronounced in that case will run concurrently with the prison term.
In early April 2017, Caldwell police contacted CID for assistance after a credit card holder reported fraudulent use. Video on an in-store surveillance camera revealed the defendants vehicle.
Two weeks later, officers spotted the vehicle at the same store and confronted the defendant. They found 22 cloned cards in his possession as he was pumping almost 167 gallons of diesel fuel into the saddle tanks of his semi-tractor truck. During the previous incident, he pumped more than 164 gallons of diesel into the tanks.
Mohammad Sado Bassam Lulu, 30, of El Paso, pleaded guilty in an El Paso district court to tobacco tax evasion and falsifying tax returns. He was sentenced to six months in jail, three years probation and 250 hours of community service and ordered to pay more than $60,000 in restitution.
Both offenses possession of tobacco products on which more than $50 in taxes are due and failure to keep books and records are third-degree felonies punishable by two to 10 years in prison and up to a $10,000 fine.
Lulu and a co-defendant purchased large amounts of tobacco products from an unlicensed supplier in Illinois, dating back to 2014, thereby avoiding thousands of dollars in Texas tobacco taxes. They also did not maintain accurate purchase records and filed false and/or incomplete returns or reports with the Comptrollers office in 2017.
The case against his brother, Mohammed Darwish Bassam Lulu, 31, also of El Paso, was dismissed in the plea agreement.
CID collaborated on the investigation with the Illinois Department of Revenue and the Texas Department of Public Safetys Criminal Investigations Division.
Diem Huyen Thi Tran (aka Huyen Thi Diam Tin), 45, of Waco pleaded guilty in a Hill County district court in March to illicit cigarette trafficking and was sentenced to two years in prison.
During a shoplifting arrest in late 2016 , Hillsboro police discovered 90 packs of unstamped Vietnamese cigarettes in her car. In Texas, cigarette packs must bear stamps indicating payment of state taxes.
Transporting unstamped cigarettes is a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine. Tran also was assessed court costs, which are being withheld from her inmate account, according to court documents.
A similar case against her husband, Van Thoung Tran, is pending prosecution in McLennan County. CID and the Department of Public Safety investigated the cases jointly.
Ms. Tran also is serving a concurrent 11-month sentence for pleading guilty to laundering more than $2,500 in illicit funds in March 2017, a felony punishable by confinement in a state jail for six months up to two years. The case was prosecuted by the McLennan County District Attorneys Office.
A special provision of the Texas Penal Code allowed the judge to consider for sentencing purposes four other offenses to which Ms. Tran admitted without being convicted: possessing 283 packs of unstamped Vietnamese cigarettes at her Waco residence; tampering with a government record; fraudulently using/possessing identifying information; and stealing property valued at less than $2,500, her third shoplifting charge (two prior convictions).
James Christopher Phillips, 39, of Munday pleaded guilty in a Haskell County district court in May 2017 to motor fuel tax evasion and was sentenced to 10 years in prison.
He could have received up to 20 years for the second-degree felony and been fined up to $10,000. He also was assessed court costs.
Phillips was unlawfully acquiring red-dyed diesel fuel in Haskell County and concealing it in the saddle tanks of his semi-tractor truck. Non-taxable diesel fuel is dyed red and authorized exclusively for off-road and/or agricultural use by permit-holders.
In a related case involving three other Munday men, Phillips also pleaded guilty to engaging in organized criminal activity and received a 19-year prison sentence. He could have been given up 99 years or life for the first-degree felony and fined up to $10,000. The two sentences will run concurrently.
The organized crime conviction was based on a second-degree felony theft charge.
In September 2016, Kendall County lawmen arrested Phillips on an outstanding warrant while driving his truck on a public roadway west of San Antonio. He was hauling a tractor worth more than $150,000. It had been stolen from a farm in Haskell County and likely was bound for the black market in Mexico.
A subsequent investigation led by special rangers of the Texas and Southwestern Cattle Raisers Association (TSCRA) identified Phillips as the primary suspect in an ag theft ring. He and three accomplices were sentenced to a combined total of 61 years in prison. Investigators recovered and returned more than $273,000 worth of equipment, including a semi-tractor truck and three semi-trailers.
CID was one of several law enforcement organizations that assisted the TSCRA rangers with the investigation. The case was prosecuted in Haskell County.
Daniel Danger, 51, of Naples, Fla. has been sentenced to 10 years in prison and fined a total of $10,000 for using one of eight re-encoded credit and debit cards to obtain almost 42 gallons of diesel fuel worth $100 from a Caldwell convenience store in mid-April.
In an Oct. 11 bench trial, District Judge Carson Campbell convicted Danger on all five counts in his indictments: transporting motor fuel without shipping documents and evading motor fuel tax, each second-degree felonies; tampering with physical evidence, a third-degree felony; and two counts of credit/debit card abuse, a state jail felony.
Danger could have been fined up to $30,000 and imprisoned for up to 34 years; instead, he will serve his prison and jail terms concurrently. He was credited with 181 days of jail time served.
Danger and a co-defendant used a pickup truck containing a 300-gallon auxiliary tank in its bed concealed by wooden panels and a tire. Evidence showed that they attempted to destroy the “cloned” cards during their apprehension.
The Caldwell Police Department assisted CID with investigating the case, which was prosecuted by the Burleson County District Attorney’s Office.
The case against the co-defendant, Santos Del Pozo Rodriguez, 54, of Houston is pending prosecution in Burleson County.
Charles Martin Smith, 29, of Haskell, pleaded guilty to the second-degree felony offense of Evade or Attempt to Evade Tax on Motor Fuel.
He was sentenced on August 11, 2016, in the 39th District Court of Haskell County, Texas, to 10 years in the institutional division of the Texas Department of Criminal Justice as part of a plea agreement. The offense is punishable by imprisonment of 2 to 20 years in prison and/or a fine of up to $10,000.
Smith was involved in stealing dyed diesel fuel which is also known as "red diesel." Dyed diesel fuel is untaxed diesel fuel and is designated for use in a nontaxable manner in off-road equipment only. Smith admitted to using unlawfully acquired dyed diesel fuel in a motor vehicle on the public highways.
Omar Hernandez Ruiz (above left), 38, of Midland, was sentenced on April 12, 2016, to 27 months in federal prison and 3 years supervised release for Conspiracy to Commit Wire Fraud, 18 U.S.C. 1343/18 U.S.C. 1349, and Alma Evangelina Valenzuela (above right), 41, of Midland, was sentenced on March 21, 2016, to 5 years federal probation for her role in the same criminal offense. She was also assessed a $6,000 fine and 300 hours of community service.
Both defendants previously pleaded guilty to their roles in this scheme. Court documents alleged that Ruiz and Valenzuela, owners of a trucking company in Midland, Texas, purchased diverted portions of fuel loads destined for another company in Odessa, Texas. The fuel distributor was unaware of the diversions and their employee would report that he delivered the full load to the client and cause the fuel distributor to electronically bill the client for the entire order of fuel.
Court documents alleged that the scheme occurred between January 2011 and December 2012. The fuel delivery driver, Salvador Garza, was previously sentenced in the case and served 21 months in federal prison. Both defendants along with Salvador Garza were ordered to pay restitution in the amount of $800,000 jointly and severally to the victim in the case.
The case was investigated by the FBI's Permian Basin Oilfield Theft Task Force and the Criminal Investigation Division of the Texas Comptroller. The case was prosecuted by the U.S. Attorney's Office for the Western District of Texas - Midland-Odessa Division as case number 7:15-CR-00171-RAJ.
An investigation conducted by the Texas Comptroller's Criminal Investigation Division (CID) recently led to the arrest and conviction of a Gorman, Texas, man on two counts of motor fuel tax fraud.
An Eastland jury sentenced Rickey Wayne Speer, 42, to 40 years in prison for unlawfully acquiring and selling large amounts of dyed diesel fuel.
"When people break Texas tax laws, they are not cheating the state – they are cheating their fellow Texans," Texas Comptroller Glenn Hegar said. "It is our responsibility to prosecute those offenders."
With the assistance of Comptroller's CID, Eastland County Criminal District Attorney Russ Thomason proved that Speer intentionally or knowingly transported motor fuel to a location without delivering documents relating to the shipment, and that Speer engaged in a motor fuel transaction without being licensed to do so as required by law.
Speer was tried as a habitual felony offender and faced a minimum of 25 years to life in prison as a result of previous felony convictions.
The Eastland and Comanche County Sheriffs' offices also assisted with this investigation.
The mission of the CID is to deter intentional criminal conduct against the state tax laws administered by the Texas Comptroller of Public Accounts. Go to the Comptroller's website for more information about CID's work.
Joe Octavio Granado, 42, of Midland, was sentenced on March 26, 2015, to 33 months in federal prison and 3 years supervised release for Conspiracy to Commit Wire Fraud, 18 U.S.C. 1343/18 U.S.C. 1349, and Juan Antonio Meza (above right), 59, of Odessa, was sentenced on March 26, 2015, to 5 years federal probation for his role. Both defendants previously pleaded guilty to their roles in this scheme.
Court documents alleged that Granado, while an employee of SC Fuels, would regularly divert a portion of a fuel order destined for his employer's client to a third party business, Red X Truck Stop. Unaware of the diversion, SC Fuels continued to electronically bill the client for the entire order of fuel and accept wire transfer payment for it. Granado would then sell the diverted load to Red X, owned by Meza.
Court documents alleged that over a two and a half year period, Granado received $774,612 from Meza for the fraudulently diverted fuel, and SC Fuel's original client paid $965,142 for the same fuel it never received. Both defendants were ordered to pay restitution in the amount of $965,142 jointly and severally to the victim in the case.
The case was investigated by the FBI's Permian Basin Oilfield Theft Task Force and the Criminal Investigation Division of the Texas Comptroller. The case was prosecuted by the U.S. Attorney's Office for the Western District of Texas - Midland-Odessa Division as cause number(s) MO14CR-153-01 and MO14CR-153-02.
When a consumer pays sales tax, he or she does so trusting the retailer will forward that money to the state. When an unscrupulous retailer obtains that tax money, then breaks the trust by intentionally failing to remit that money perhaps keeping, investing, or spending it the consumer and the entire state are victimized. SB 934 dramatically raises the stakes for anyone caught defrauding Texas taxpayers in this way.
Senate Bill 934 (2011), signed by the Governor, amends the Tax Code to treat tax cheats the same as property thieves. Beginning Sept. 1, 2011, anyone who collects and intentionally doesn't remit sales tax will face the same criminal penalties as property theft.
SB 934 also amends the Penal Code to allows investigators to:
Sales tax fraud harms all Texans. Now with SB 934, this scam can be punished in tough new ways in the criminal justice system just as strongly as theft and pursued as money laundering and organized crime when appropriate.
In 2015, the Texas Legislature passed House Bill 855, which requires state agencies to publish a list of the three most commonly used Web browsers on their websites. The Texas Comptroller’s most commonly used Web browsers are Google Chrome, Microsoft Internet Explorer and Apple Safari.