Government Waste Strikes Again!! $$$$

iVillage Member
Registered: 04-04-2001
Government Waste Strikes Again!! $$$$
21
Fri, 08-03-2012 - 2:52pm

From:  CNBC

Tax Scam: IRS Pays Out Billions in Fraudulent Refunds
Published: Thursday, 2 Aug 2012 | 3:25 PM ET
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By: Eamon Javers
CNBC Washington, DC Correspondent
 
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IRS
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The IRS is paying out billions of dollars in fraudulent tax refunds to identity thieves; a problem that the tax service’s inspector general told CNBC is a “growing problem” involving numbers that are increasing “exponentially.”

In a new report to be issued Thursday, the inspector general for the IRS says that tax thieves are stealing the identities of taxpayers and then filing bogus returns on their behalf and collecting fraudulent refunds as a result.

The inspector general estimates that the IRS could issue as much as $21 billion in fraudulent tax refunds over the next five years.

The scam is so rampant that thieves are apparently sending in false returns in bulk without even bothering to change the mailing address on the returns. The inspector general said it found one residential address in Lansing, Michigan that was the source of an astonishing 2,137 tax returns, and to which the IRS directed more than $3.3 million in potentially fraudulent refunds.

 

 
 
 

In another case, a single residential address in Chicago was the source of 765 tax returns, generating more than $900,000 in potentially fraudulent refunds, the report said.

“Once the money is out the door, it is almost impossible to get it back,” IRS inspector general J. Russell George told CNBC. “The bad guys know that the IRS is unable, given the limited number of its staff it has, to address every single allegation of tax fraud it has.”

The report said the identity theft scam is most prevalent in Florida, with two cities, Tampa and Miami, topping the list of potentially fraudulent claims. Tampa saw 88,724 potentially fraudulent returns filed, generating refunds of more than $468 million. And Miami saw 74,496 potentially fraudulent returns generating more than $280 million in possibly bogus returns.

 

 
"Once the money is out the door, it is almost impossible to get it back.”

J. Russell George
Inspector General, IRS

 

The inspector general concluded that the IRS is simply not doing enough to stop identity theft fraud. “Unfortunately, the IRS is not using information that it currently has, nor information that could be available to them,” George said.

In its analysis, the inspector general’s office said it identified approximately 1.5 million tax returns with potentially fraudulent tax refunds that the IRS had missed during tax year 2010. The potential fraud for that one year totaled in excess of $5.2 billion. That led the report’s authors to estimate that the “IRS could issue approximately $21 billion in fraudulent tax refunds resulting from identity theft over the next five years.”

Among the report’s other findings, was that the “use of direct deposits, including debit cards, to claim fraudulent tax refunds increases the risk that the IRS will not detect identity theft. The IRS continues to allow multiple direct deposits to the same bank account.”

The inspector general recommended that the IRS make certain changes in the way it operates internally, and that it push for new legislation on Capitol Hill that would give it access to the National Directory of New Hires database to help weed out identity theft.

In a response to the critical report, IRS wage and investment division commissioner Peggy Bogadi wrote, “We are devoting significant resources to combat tax refund fraud using stolen identities and have already taken action with respect to issues identified in the report.” And because of actions the IRS has already put in place, she wrote, “we believe that the report’s projection of undetected fraudulent refunds over the next five years is significantly overstated.”

 

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© 2012 CNBC.com

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iVillage Member
Registered: 03-03-2009
Fri, 08-03-2012 - 7:09pm

This is NOT an instance of "government waste". 

Jabberwocka

iVillage Member
Registered: 04-04-2001
Wed, 08-08-2012 - 2:24pm

Don't know how you define waste, but to me a government that is sending 100's of tax "refunds" to the same address  is WASTING taxpayers' money :

Florida home files 741 tax returns in single year, gets more than $1M in refunds By Eric Pfeiffer, Yahoo! News | The Sideshow – 18 hrs ago
 

Fraudulent tax returns is a booming business in Florida (Fox News)A single home in Florida filed 741 different tax returns in a single year, receiving more than $1 million in refunds.

The Sun Sentinel says the findings were released in a report issued by the Treasury Inspector General for Tax Administration. The independent watchdog group oversees the IRS.

"The report really underscores just how bad a problem ID tax fraud is in Florida and around the country," said U.S. Sen. Bill Nelson, who asked the Treasury Inspector General last year to investigate the extent of the problem. "It's become an epidemic that's costing law-abiding U.S. taxpayers billions of dollars. And it's one we've got to fix. That's why I've filed legislation aimed at putting a stop to these fraudsters."

And while the IRS has not officially confirmed the findings, House Oversight Subcommittee Chairman Charles Boustany Jr., R-La., referenced the 741 filings as originating from a single home.

[Related: IRS missing billions to ID theft]

The Sun notes that three of the top five fraudulent returns in the U.S. last year originated in Florida, with Miami and Tampa being cited as the top cities to submit potentially fraudulent returns. A Tax Administration spokesman said nearly 75,000 fraudulent returns were submitted from Miami in 2010, totaling $281 million in refunds. The IRS says it has been attempting to crack down on identity theft by increasing protective measures against the crime.

Rep. Boustany said another home in Tampa sent out fewer returns, 518, but received refunds totaling $1.8 million. In addition, he says a post office box in Orlando received just over $1 million for 703 suspected fraudulent returns.

"Over the past several years my office has seen a dramatic increase in the number of individuals needing assistance because of tax refund identity theft, a clear indication this crime is becoming a big problem in South Florida," said Rep. Debbie Wasserman Schultz, D-Fla.

iVillage Member
Registered: 03-03-2009
Sat, 08-11-2012 - 11:14pm
If a private company was being bilked, if a bank was being robbed, would you call that "waste"? If not, then you are being inconsistent.

Jabberwocka

Avatar for xxxs
Community Leader
Registered: 01-25-2010
Sun, 08-12-2012 - 11:42am

This is criminal action not waste!

dragowoman

iVillage Member
Registered: 03-03-2009
Mon, 08-13-2012 - 8:52am
Yes. The criminals are those who are using fraud to try to get money which is not theirs.

Jabberwocka

iVillage Member
Registered: 10-25-2006
Sat, 08-18-2012 - 4:07pm

Thanks to the GOP-controlled House, the IRS cannot get any increase to fight fraud.  If the GOP had any brains, they'd understand that as ID theft cases increase so should the resources allocated to fighting fraud be increased. 

Let's get the Dems back in Congress to straigten things out!

http://www.irs.gov/pub/newsroom/budget-in-brief-2012.pdf

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http://www.pnhp.org/news/2009/october/meet_the_new_health_.php

http://www.youtube.com/watch?v=DQTBYQlQ7yM

iVillage Member
Registered: 03-02-2009
Thu, 08-30-2012 - 11:34pm

Doesn't Obamacare provide for our tax dollars to hire a load of IRS agents to get after us?

I'm guessing that a lot of Americans would not shed a single tear after hearing that this arm of the government was axed.

"Resist, we much. We must, and we much. About that, be committed."

Avatar for xxxs
Community Leader
Registered: 01-25-2010
Fri, 08-31-2012 - 12:36am

Which arm of government are you talking about?

    It seems that this was due to poor programming of the refund system.  That many refunds should raise flags for fraud.

chaika

iVillage Member
Registered: 03-02-2009
Fri, 08-31-2012 - 11:37pm

I am talking about the IRS. They are out of control. Though not as out of control as the EPA.

"Resist, we much. We must, and we much. About that, be committed."

iVillage Member
Registered: 03-02-2009
Re: Government Waste Strikes Again!! $$$$
Thu, 09-13-2012 - 8:38am
janetlz wrote:

My friend from Somalia praises the U.S. for it's law-abiding citizens.  Republicans would have us return to the wild west days; each man (and his guns) for himself.  Except today it would look more like Somalian-style anarchy than the good ol' days.

You seem to be completely misinformed about what Republicans stand for, if that's what you think.

Who would support a candidate from a party that is 92% white?

I do not base my vote on race. I base it on values, as in what candidate will adhere to the Constitution and what it stands for. Now go ahead and mis characterize that.

 

 

"Resist, we much. We must, and we much. About that, be committed."

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