CHARLOTTE, N.C. — Federal agents said three women -- an undocumented immigrant, a legal resident and a U.S. citizen -- are behind a $5.1 million tax fraud scheme to steal money from the government and send cash to Mexico.
Court documents state the women filed hundreds of bogus tax returns and used the additional child tax credit to illegally claim credit for children in Mexico or children who don't exist.
The tax credit was intended to help working families who are raising three or more children by giving a refund of $1,000 per child. There's no limit on how many children under the age of 17 one person can claim.
Postal workers noticed a flood of U.S. treasury checks going to apartment mailboxes in May.
Eyewitness News spoke with neighbors at a complex off West Arrowood Road. Channel 9 asked neighbor Harisha Jackson if she saw police search an apartment.
"Yeah, we saw the police search the apartment, but they didn't say anything to us," Jackson said. "They searched the apartment and left. That was it."
Eyewitness News captured video when the IRS searched one suspect's home on Peach Place Lane in August.
A report from the treasury inspector general stated undocumented immigrants pocketed $4.2 billion in refunds in 2010.
CLICK HERE for information from the IRS on how to report suspected tax fraud.
Sen. Richard Burr (R-North Carolina) co-sponsored legislation to stop the fraud.
"This wouldn't happen if we simply required people to simply file the proof we need to know who they are and why they're here," Burr said.
Senate Bill 30-83 would require those who apply for child tax credits to submit several documents proving their identities and the identities of the children they claim. The bill is being studied in committee.
"I think now that the American people understand there is a problem here, they're going to hold Congress and these agencies responsible to make changes," Burr said. "I'm optimistic."
The women, Cathy Lee Cisneros and Candida Mayo Figueroa, pleaded guilty in November and are waiting to be sentenced.
They helped the case against the accused tax scheme leader, Ana Portillo, who was indicted in December.
The women convicted could face 10 years in prison and a $250,000 fine. They will have to pay back the government. Because Figueroa is an undocumented immigrant, she will be deported.
Immigration groups are fighting Burr's proposal involving the child tax credit. The National Immigration Law Center claims it would harm millions of children, punish taxpaying families and unfairly target Latino families.