Senior Online Safety - Tax Refund Identity Theft

Tax Refund Identity Theft continues to be a growth industry

Criminals from within the United States and beyond continue to manipulate their way into the IRS process and procedures and commit Tax Refund Identity Theft, confirms the IRS in their recent reports, “Case Processing Delays and Tax Account Errors Increased Hardship for Victims of Identity Theft” (Reference 2013-40-129 – September 2013) and  “Detection Has Improved; However, Identity Theft Continues to Result in Billions of Dollars in Potentially Fraudulent Tax Refunds” (Reference 2013-40-122 – September 2013).  The IRS has “refunded” more than $4 Billion to Identity Theft thieves. According to the September reports, released in early November, in 2012, the IRS was prevented from issuing $12,108,211,555 tax refunds (you read this number correctly $12+ billion), with fraudulent tax returns totaling in excess of $5.2 billion.

IRS sent 655 tax refunds to a single address in Lithuania, and another 343 refunds went to a single address in Shanghai.  To repeat: That is 655 tax refunds to one address in Lithuania, 343 refunds to one address in China. But this isn’t just foreign criminals, others are right here in the US – two separate addresses in Orlando received 580 and 291 separate tax refunds – the former total $870,000, while the latter total $466,000. Quite the payday.

The IRS describes, “The constantly evolving tactics used by scammers to commit identity theft continues to be one of the biggest challenges facing the IRS.”  When it takes, on average, 312 days to resolve Tax Refund Identity Theft, there seems to be more at play than being technologically outwitted, especially when the IRS notes that 24% of Tax Refund Identity Theft cases were in process for more than 365 days, with one having been opened for 1,329 days.  For those of us who are over 50 and don’t buy green-bananas, this delay and apparent lack of investment by the IRS in protecting their constituents is simply shocking. The problem is not new, as detailed in the May 2012 document “Most Taxpayers Whose Identities Have Been Stolen to Commit Refund Fraud Do Not Receive Quality Customer Service.”

Senior Online Safety - Tax Fraud Identity Theft

So just how big is this Tax Refund Identity Theft fraud? This diagram is lifted directly from the aforementioned report. You will note that in 2012 there were 1,785,866 incidents affecting 1,219,208 taxpayers. In the first six months (January – June 2013) the numbers have already eclipsed those for the entire calendar year 2012 with 1,901,105 incidents affecting 1,630,611 taxpayers, well on the way to break through 2 million instances.

The IRS goes on to say, “We estimate that approximately $183 million in potentially fraudulent tax refunds were paid to identity thieves who filed tax returns before the legitimate taxpayers filed theirs.”

What can you do?

I offer some thoughts on minimizing the sharing of your PII: Senior Online Safety – PII and Tax Return Identity Theft

Take a few moments and understand how the criminals go about their business – look at this diagram provided below. You will note the criminal starts with your personal identifying information (PII) – this includes your Social Security Number, your Date of Birth, your Place of Birth, etc.  Ask yourself, just how widely have you shared any or all of these piece of PII?  Going forward, ask the reason why behind every request for your PII – when challenged as being uncooperative, share this diagram with your interlocutor.

Senior Online Safety - Tax Fraud Identity Theft - How To

 

 [divider style=”double”][/divider]

Follow us // Síganos

Senior Online Safety - FacebookSenior Online Safety - G-plusSenior Online Safety - RSS FeedSenior Online Safety - TwitterSenior Online Safety - You Tube

[divider style=”double”][/divider]

[divider style=”double”][/divider]

Additional reading:

Chicago Tribune - Senior Online Safety - ID Theft
Tax refund ID theft is growing ‘epidemic’: US IRS watchdog (Chicago Tribune, November 2013)

AARP - Senior Online SafetyTax refund scams – ID Theft, Fraudulent Returns, IRS (AARP, February 2012)

 

(NOTE: ID Warriors is a product offered by Aegis Identity Group – Prevendra has a realationship with Aegis Identity Group and Christopher Burgess is a member of their Advisory Board)

 

Photo credit:  © Andres Rodriguez | Dreamstime Stock Photos

Comments

comments