Isle inmate is indicted
for federal tax fraud

Paul Lanakila Campos filed employer's quarterly federal tax returns from March 2000 to July 2002 seeking refunds totaling nearly $100,000.

He also filed individual federal tax returns seeking $18,713 in refunds for calendar years 1999 to 2001.

The problem was that Campos, 50, was a state prison inmate for a majority of the period for which he sought refunds and knew he wasn't entitled to them, federal prosecutors said.

Campos, who is originally from Maui, was indicted by a federal grand jury Wednesday in a 15-count indictment charging him with making false, fictitious or fraudulent claims against the U.S. government.

Campos is expected to make his first appearance on the federal charges in U.S. District Court on May 9.

The indictment comes as he awaits trial in state court on charges he fraudulently obtained over $7,400 in state tax refunds while in prison.

According to the federal indictment, Campos allegedly filed 13 separate Employer's Quarterly Federal Tax Returns or Form 941s claiming refunds of overpaid withholding taxes ranging from $2,340 to $9,740. The total amount he allegedly claimed is $99,167.

Campos also filed three U.S. individual tax returns requesting refunds of $3,519, $9,116 and $6,078.

According to state Department of Safety officials, Campos was shuttled between correctional centers on Maui and Oahu between August 2000 and September 2004 when he was released -- periods that coincide with the dates of the alleged federal offenses.

He was previously released on parole in November 1999, said Department of Public Safety spokesman Mike Gaede.

Campos was initially indicted by an Oahu grand jury in April 2003 with three counts of making false statements in 2000, 2001 and 2002 and three counts of second-degree theft.

According to state prosecutors, Campos allegedly concocted bogus employers, prepared false W-2s and obtained state refunds while in prison. He was issued refund checks of $1,502 in 2000, $2,687 in 2001 and $3,283 in 2003.

Jeffrey Arakaki, Campos' attorney in the state matter, could not be reached for comment. Deputy Attorney General Larry Goya said the case is set for trial May 16.

Campos' scheme apparently unraveled after a clerk in the business office at Waiawa Correctional Facility noticed that he was receiving tax refund checks for periods during which he was incarcerated and brought it to the attention of warden Ted Sakai.

Sakai said he immediately notified Internal Affairs, who called the state tax and federal IRS offices.

Sakai said the employee, who declined to be identified, deserves a lot of credit for bringing the matter to his attention.

State conviction records show that Campos has an extensive criminal history. Between February 1979 and September 2000, Campos had racked up 42 convictions, including 20 felonies, a majority of which were for thefts and burglaries.