Arrests in what Weld County officials claim is the largest identity- theft case that they’ve investigated have been halted by a judge who believes they may be based on an improper search warrant.
After obtaining the search warrant, the Weld County district attorney’s office, the Weld County Sheriff’s Office and the Greeley Police Department in mid-October seized 1,338 tax files from Amalia’s Translation and Tax Service in Greeley.
At the time, investigators claimed that many people using the tax service were obtaining false names and Social Security numbers in a massive identity-theft scam.
Authorities traced approximately $2.6 million in payments to illegal immigrants using phony Social Security numbers who used the tax service, said Weld County District Attorney Ken Buck.
As of Nov. 13, 26 arrest warrants had been issued and 11 people arrested as a result of the investigation, Buck said.
But Weld County District Judge James Hartmann has raised questions about the search warrant that authorized seizure of the tax files.
Hartmann has issued a show-cause order directing the Weld County district attorney to show why any state court would have jurisdiction to issue a search warrant for federal tax files.
Hartmann said he believes the filing of a federal tax return and the receipt of a federal tax refund may be matters that fall within the exclusive jurisdiction of the U.S. government, not a state court.
Federal tax return information in the possession of a tax preparer falls within the confidentiality mandates of federal statute, Hartmann said.
He said the warrants that have led to arrests and prosecutions appear to be based solely on information obtained from the Oct. 17 Amalia’s raid — dubbed “Operation Numbers Game” — and specifically from information contained in federal tax returns.
Hartmann said he will not issue any arrest warrants based on information from federal tax returns. He will consider issuing a warrant if the affidavit is based on information not related to the seized tax returns.
The Weld County DA’s office maintains that the state court has jurisdiction. It says those involved filed a federal tax return and obtained a tax refund unlawfully. Others, the office alleges, were able to obtain employment through the use of a Social Security number belonging to someone else.
Hartmann has set a hearing on the matter for Thursday.
In the meantime, Judge Roger Klein, chief judge of the Weld County District Court, has issued an order sealing all arrest warrants and tax-related documents in the case.
Howard Pankratz: 303-954-1939 or hpankratz@denverpost.com
