Online romance scam “money mule” sentenced for dual crimes

FLORIDA — A Florida woman was sentenced last week to two years in prison for a scheme to file false tax returns and to two years in prison for an unrelated online romance scam.

The two sentences are to run concurrently with each other, according to the US Attorney’s Office for the Middle District of Florida.

According to court documents and statements made in court regarding the online romance scheme, in 2020, Iona Coates of Orange Park met two individuals online through a dating website. She subsequently provided them with her bank account information and began receiving money from victims of the scheme into her account. She sent the money she received to them.

In December 2020, U.S. Secret Service agents met with Coates and explained that she was acting as a “money mule” in an online romance scheme. As the agents described, the individuals acting as fake suitors on dating websites convinced victims to send money to Coates’s bank account.

The Secret Service advised Coates to cease participation in the scheme, as the individuals were using her bank account to facilitate their theft. Coates, however, soon thereafter began acting as a money mule for another online romance scammer.

Between December 2020 and September 2021, she reportedly received $229,376.26 into her bank accounts from scheme victims and sent the money to the scammer.

In July 2023, she pleaded guilty to conspiracy to commit wire fraud.

According to court documents and statements made in court related to the tax scheme, Coates owned and operated Bits & Bytes Accounting Services Inc., located in Jacksonville, which provided tax preparation and bookkeeping services. Between 2015 and 2020, Coates claimed $228,788 in tax refunds on her individual federal income tax returns by falsely reporting that taxes had been withheld from her income and had been paid to the IRS.

Coates is said to have further enriched herself by creating nearly 20 sham entities for the sole purpose of filing false tax returns that claimed fuel tax credits. Between 2017 and 2019, Coates prepared and filed 35 such returns.

In July 2023, she pleaded guilty to aiding and assisting in the preparation of a false tax return.

In addition to the term of imprisonment, U.S. District Judge Brian Davis ordered Coates to serve a total of three years of supervised release for both schemes.

Judge Davis also ordered Coates to pay approximately $186,288 in restitution to the United States related to the tax charges and $229,376.26 in restitution to the victims of the romance scheme.

Acting Deputy Assistant Attorney General Stuart M. Goldberg of the Justice Department’s Tax Division and U.S. Attorney Roger B. Handberg for the Middle District of Florida made the announcement.

IRS Criminal Investigation investigated the tax scheme, and the U.S. Secret Service investigated the online romance scheme.

Trial Attorneys Kevin Schneider and Wilson Stamm of the Justice Department’s Tax Division and Assistant U.S. Attorney Kevin C. Frein for the Middle District of Florida prosecuted the tax case. Assistant U.S. Attorney Frein prosecuted the online romance scheme case.