Former Colorado driving instructor sentenced to prison for mail fraud, filing false tax returns

DENVER — A former driving school instructor was sentenced in federal court Wednesday to 15 months in prison for a scheme involving defrauding the state's license agency and for lying on his tax returns.

This sentence resulted from an investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI), the Internal Revenue Service – Criminal Investigation (IRS-CI) and the Colorado Department of Revenue's Motor Vehicle Investigations Unit.

Stuart Bryan King, 54, of Centennial, Colorado, was sentenced Aug. 27 to 15 months in federal prison for mail fraud and filing a false tax return. King is the owner of Little Lake Driving Academy (LLDA).

King was charged by a complaint March 5, 2013 and subsequently charged by a grand jury in Denver April 8, 2013. He pleaded guilty March 7.

According to the charging documents and plea agreement, King's business acted as a third party tester for the Colorado Department of Revenue – Division of Motor Vehicles, administering written and driving examinations on behalf of the state in order for individuals to obtain a driver's license.

From August 2009 through November 2012, King and an employee of LLDA knowingly devised and participated in a scheme to defraud the state by falsely certifying that applicants for a license and instruction permit had successfully completed the required testing. As part of the scheme, the two defendants falsely certified that applicants had taken and passed written tests. The applicants then presented the certified documents to the state and received a valid Colorado driver's license and/or instruction permit.

King administered nearly 1,000 of these fraudulent tests between 2009 and 2012, collecting $323,050 in fees.

For tax years 2009 through 2011, King failed to file business tax returns and under-reported income, which resulted in a tax loss of $33,772.

Furthermore, the investigation revealed that people who could not speak, read or write English traveled from Missouri and other states to Colorado using previously stolen identities of U.S. citizens to utilize the services of King's business.

In separate charging documents, 20 individuals who had utilized the services of LLDA and who turned in Missouri identification cards were indicted in Colorado for aggravated identity theft.

Those charged in connection to this criminal enterprise include:

Catarina Alcon, Freddy Castro-Alcon, Lucia Contreras Perez, Juan Garcia, Elias Garcia-Perez, Diego Hernandez-Batz, Candelarlio Hernandez-Perez, Martha Jimenze-Ortiz, Gustavo Monteroso-Velasquez, Isnael Raymundo, Jose Antonio Rivera, Felix Solis, Carlos Villa-Flores and Elias Zetino-Vicente.

"The fraudulent use of identification documents, both real and counterfeit, may allow the bearer to board an aircraft, improperly obtain a government benefit or allow a criminal to remain in the shadows undetected. These crimes represent a very real threat to our public safety and the security of our nation," said Kumar Kibble, special agent in charge of HSI Denver. "Through the combined authorities and expertise of our federal, state and local law enforcement partners, we will continue to aggressively target those participating in or facilitating these crimes."

"The fraud committed by this defendant put the public's safety at risk," said U.S. Attorney John Walsh. "By providing documentation authorizing the issuance of driver licenses to those who have not properly qualified not only puts the driving public at risk, it potentially hides individuals' true identities."

"Investigating and prosecuting tax fraud and identity theft are priorities for IRS Criminal Investigation," Stephen Boyd, Special Agent in Charge for IRS Criminal Investigation, Denver Field Office. "We will continue to work with our law enforcement partners to bring those to justice who commit these crimes harming our citizens whose identities are stolen."

Following his prison sentence King will serve three years of supervised release. King was also ordered to pay a $3,500 fine as well as $33,772 in restitution to the IRS.