Flor Soto, Theft of Public Funds, NY 2024

Flor Soto, a 53-year-old Brooklyn woman tied to Bronx-based K&S Tax Solution, Inc., was sentenced to 87 months in federal prison for her role in a brazen scheme that looted more than $24 million from the U.S. Treasury. Soto, an associate at the fraudulent tax prep firm, pleaded guilty to theft of public funds and was hit with a massive forfeiture order of $24,719,724. The case, prosecuted by the U.S. Attorney’s Office for the Southern District of New York, dismantled one of the largest IRS refund fraud operations in recent memory.

Between 2008 and February 2013, Soto and her co-conspirators at K&S orchestrated a sprawling identity theft network, filing hundreds of fraudulent tax returns using stolen Social Security numbers—many belonging to Puerto Rico residents. They obtained electronic filing identification numbers (EFINs) under victims’ names, then used those credentials to submit false returns loaded with fake dependents, including children whose identities were stolen outright. The refunds flowed in via checks and wire transfers, all siphoned into the pockets of the conspirators.

Soto wasn’t just a participant—she was a key architect. She recruited others into the scheme and served as a primary source of stolen identities, enabling the massive volume of fraudulent filings. The IRS has tied at least $281,348,627 in attempted fraudulent returns to EFINs linked to Soto and her K&S associates. Her co-conspirator, Eliana Sarmiento, was convicted on September 23, 2016, after a trial that exposed the depth of the operation.

U.S. District Judge Kimba M. Wood handed down the 87-month sentence and tacked on three years of supervised release. The forfeiture order ensures that every dollar Soto stole will be pursued by federal authorities. Manhattan U.S. Attorney Preet Bharara made it clear: “Flor Soto and her co-defendants stole an astounding $24 million in tax refunds from the U.S. Treasury, using stolen identities to file false tax returns.”

IRS-CI Acting Special Agent in Charge Kathy A. Enstrom didn’t mince words: “Individuals like Flor Soto who commit identity theft and refund fraud of this magnitude will be held accountable and deserve to be punished to the fullest extent of the law.” The investigation, led by IRS Criminal Investigations with assistance from the U.S. Secret Service, tore apart a criminal enterprise that exploited the tax system and harmed innocent victims whose identities were hijacked.

To date, 15 people connected to K&S Tax Solution—including Soto—have been convicted. The case is being handled by the Office’s General Crimes Unit, with Assistant U.S. Attorneys Eun Young Choi and Andrew C. Adams leading the prosecution. As federal authorities continue to claw back ill-gotten gains, the message is clear: stealing from the Treasury using stolen lives carries steep consequences.