Milford woman pleads guilty to role in IRS impersonator scam: She was the money mule

Kari Morales is a scammer who got scammed herself.

At the behest of a cohort she met online, the Milford woman drove to Grand Rapids one day to collect $60,000 in cash from a woman who, she thought, had been tricked into believing an FBI warrant was out for her arrest over a tax issue with the IRS.

Morales showed up for the money in full costume: She had a loaded gun in her waistband, a gold police badge, a fake IRS receipt and a phony FBI arrest warrant.

What she didn't know, however, was that the person she met in the parking lot that day really was an undercover federal agent.

In U.S. District Court this week, Morales, 51, of Milford, pleaded guilty to wire fraud, admitting she was the money mule in a scheme designed to steal $60,000 from a Kent County woman who was targeted on her cell phone. According to court documents, Morales's co-conspirator contacted the victim on her cell phone one day, pretending to be with the IRS fraud division. What the fraudster did not know, however, was that the victim's cell phone number had been reassigned to a federal agent, triggering an investigation that would lead to the arrest and conviction of the mule: Morales, who drove across state to collect $60,000 from a supposed-victim, in exchange for a $2,500 cut of the pie.

'The federal government does not send text messages asking for money'

“Everyone with a cell phone must be vigilant to avoid schemes to defraud that target victims through text messages,” U.S. Attorney for the Western District of Michigan, Mark Totten, said in announcing the guilty plea.

He stressed: “Make no mistake: The federal government does not send text messages asking for money, advising you to move money to another account, requesting that you convert cash to cryptocurrency, or proposing an exchange of money for a 'Get Out of Jail Free' letter.”

The name of Morales's co-conspirator has not been disclosed. Court records show she knew him only as "Tom," and that he offered her $2,500 for her services, which involved printing out a fake FBI arrest warrant and phony IRS receipt and driving to Grand Rapids to collect the $60,000 from the supposed victim.

It is not known if "Tom" has been identified or charged for his role in the scheme, which the government says included three individuals: "Tom," Morales, and another unnamed co-conspirator.

How Milford money mule landed on feds' radar

According to court documents, here is how Morales landed on the federal government's radar:

Sometime early this year, a man known only to Morales as "Tom" sent this unsolicited text message to a woman in Kent County:

"Hello ... my name is Wayne Johnson. I am contacting you from the IRS fraud department regarding your recent tax return filing. We detected that your last tax return was inappropriate and misleading. We need to sort this out with you before handing it over to appropriate authorities."

The text continued: "Please respond to this text message while we discuss possible solutions to avoid you being charged for fraudulent tax filing. Thank you”

After the initial contact was made, demands were made of the victim: pay money, or you will be arrested and prosecuted. This ,"Tom," then made up more lies, telling the victim that a federal warrant had been issued for her arrest in March pursuant to a grand jury indictment for tax fraud, and that federal agents could arrest her if payment to the IRS was not made.

More:Scammers convince people to hand over thousands in cash, use couriers to pick it up

Fraudsters used scare tactics: Pay up, or face arrest

Meanwhile, "Tom" and Morales were communicating online about this scam, with Morales agreeing to help her cohort collect the money.

Specifically, according to the indictment, "Morales agreed to print out — and did print out — a digital copy of a document entitled 'FBI WARRANT OF ARREST' on what was purported to be FBI letterhead."

"Tom" had emailed her the warrant.

"The document falsely represented that the warrant allowed law enforcement to arrest (the victim) for tax fraud, punishable by up to 10 years in prison and a fine of $95,000."

Morales also printed out a digital copy of a fake IRS receipt, dated April 8, 2024, falsely claiming that the victim had paid the IRS $60,000 in connection with a tax refund fraud and, as a result, would not be charged for tax fraud.

On April 8, with loaded gun in waistband and fake documents in hand, Morales drove to a Grand Rapids parking lot to get the money. She placed the police badge, which was issued to another person by a Michigan municipality, on the front passenger seat of her vehicle.

When Morales met with the presumed victim, she was handed an envelope purporting to contain cash. She then handed over her own envelope, which contained the fake documents.

The intended victim lost no money in the scheme.

Morales, though, could lose her freedom. She faces a maximum sentence of 20 years in prison. A sentencing date has not yet been set. Her attorney could not be reached for comment.

Tips on how to avoid falling prey to fraudsters

To protect yourself against fraudsters, the FBI Elder Fraud website offers the following tips when getting a suspicious phone call or text message, including:

∎End all communication with a suspected perpetrator.∎Search online for the contact information (name, email, phone number, addresses) and the proposed offer. Other people have likely posted information online about individuals and businesses trying to run scams.∎Resist the pressure to act quickly. Scammers create a sense of urgency to produce fear and lure victims into immediate action. Call the police immediately if you feel there is a danger to yourself or a loved one.∎Be cautious of unsolicited phone calls, text messages, mailings, and door-to-door services offers.∎Never give or send any personally identifiable information, money, jewelry, gift cards, checks, or wire information to unverified people or businesses.∎Make sure all computer anti-virus and security software and malware protections are up to date. Use reputable anti-virus software and firewalls.∎Disconnect from the internet and shut down your device if you see a pop-up message or locked screen. Pop-ups are regularly used by perpetrators to spread malicious software. Enable pop-up blockers to avoid accidentally clicking on a pop-up.∎Be careful what you download. Never open an email attachment from someone you don't know, and be wary of email attachments forwarded to you.∎Take precautions to protect your identity if a criminal gains access to your device or account. Immediately contact your financial institutions to place protections on your accounts, and monitor your accounts and personal information for suspicious activity.If you or someone you know is age 60 or older and has experienced financial fraud, experienced professionals are standing by at the National Elder Fraud Hotline: 1-833-FRAUD-11 (1-833-372-8311).

Contact Tresa Baldas: tbaldas@freepress.com