A Wisconsin man is facing time in prison for his role in a massive tax-fraud investigation that was first reported by a Medford couple.
Curtis S. Pethley, 62, will be sentenced Wednesday in U.S. District Court in Eugene after previously admitting to his roughly $400,000 role in a multimillion dollar tax fraud that led to Medford convictions of six Nigerian nationals in 2017 and 2018.
The married couple reported to the IRS that someone had filed 2013 taxes in their name, sparking an investigation involving nine federal agencies and also leading to arrests in Georgia, Maryland and Texas.
Pethley got his instructions from an individual in Nigeria who he met through a dating website, known as “Queen Jenn.”
Pethley bought MyVanilla prepaid debit cards in South Barrington, Illinois, and then the fraudsters used them to load tax refunds in the Medford victim names, according to documents filed by the U.S. Attorney’s Office.
By May 2014, investigators conducted a search of Pethley’s home, where they found 150 other prepaid debit cards and $50,000 in money orders. He also reportedly withdrew fraudulent tax refunds and pocketed cuts of between 10 and 20 percent.
Federal prosecutors say actual losses from Pethley’s role were $444,393.
Pethley’s defense lawyer Mark Sabitt of Eugene argued that he was “preyed upon by a savvy con artist.”
“The background for how Mr. Pethley became involved, however, reflects an isolated and lonely person in desperate need for social acceptance,” Sabitt wrote in a document filed Wednesday.
Queen Jenn was actually Saheed Animawun of Lagos, Nigeria, brother of convicted fraudster Lateef Aina Animawun, according to Sabitt. Lateef Animawun had been living in Marietta, Georgia, prior to his arrest.
Pethley met Queen Jenn in 2011, and they communicated solely through email and instant message exchanges.
“Their exchanges are rife with sexual innuendo and promises of various types of sexual gratification made by ‘Queen Jenn’ to Pethley and Pethley is clearly enamored of ‘her,’” Sabitt wrote.
U.S. District Court records in Oregon show that Saheed Animawun has not been charged in the fraud, but new arrests continue in the case — most recently the Texas arrest of Oluwole Oluwaseun Odunowo in January. Odunowo has been held in the Jackson County Jail since Feb. 7.
Sabitt said that at least one other convicted fraudster used “online romance chat rooms as a recruiting tool.”
“At this point, there are several similarly situated individuals like Mr. Pethley, who were recruited by the principal conspirators, who have not been charged with an offense,” Sabbitt wrote.
Federal prosecutors want a 37-month prison sentence for Pethley because he was on probation for misdemeanor theft during the time he participated in the fraud ring.
Pethley has been separately sentenced to prison in U.S. District Court in Wisconsin for child pornography after a December 2016 arrest “involving particularly disturbing sexually explicit conduct against children.”
“This all demonstrates an escalating degree of criminal conduct,” U.S. Attorneys argue.