Federal charges have been filed against 40 defendants in 20 separate cases in Florida dealing with thousands of stolen identities and millions of dollars of fraudulent identity theft tax filings.
Wifredo Ferrer
A special strike force including federal prosecutors, the IRS’s Criminal Investigation division, the FBI, the Secret Service, the Social Security Administration and local police departments in Miami and nearby towns in South Florida announced the crackdown Wednesday.
According to the Federal Trade Commission, Florida had the highest rate of identity theft in the United States in 2011, they noted. While identity theft in Florida ranks highest in the United States, the identity theft rate in Miami has reached near epidemic proportions. Florida’s rate of 178 complaints per 100,000 residents is dwarfed by the Miami rate of 324.1 complaints per 100,000 residents. The City of Miami’s per capita number of false returns based on identity theft was 46 times the national average, and its per capita SITR fraud dollar value was more than 70 times the national average. Worse still, the problem is projected to grow.
A September 2012 report by the Treasury Inspector General for Tax Administration found that Florida has the highest rate of stolen identity tax refund fraud in the United States. The report identified 74,496 potentially fraudulent returns filed in Miami, resulting in more than $280 million in bogus refunds. The TIGTA report estimates that the IRS could issue as much as $21 billion in fraudulent tax refunds over the next five years.
In an attempt to combat the rising wave of stolen identity refund scams, and armed with newly enhanced investigative and prosecutorial tools under the Department of Justice’s Tax Directive 144, the U.S. Attorney’s Office for the Southern District of Florida established the South Florida Identity Theft Tax Fraud Strike Force. Members of the Strike Force include IRS-CI, the U.S. Secret Service, the FBI, the U.S. Postal Inspection Service, the City of Aventura Police Department, the Miami-Dade Police Department, the North Miami Beach Police Department, and the SSA-OIG. The focus of the Strike Force is to investigate and prosecute SITR fraud in the SDFL. Today, U.S. Attorney Ferrer, joined by members of the Identity Theft Tax Fraud Strike Force, announced the most recent results of their investigative efforts.
“So far this year, we have charged a total of 79 individuals responsible for almost $40 million in fraudulent tax refunds obtained through identity theft,” U.S. Attorney Wifredo A. Ferrer said in a statement. “The cases being investigated and prosecuted include victims from all walks of life, including police officers, potential U.S. Marine recruits, members of the Armed Forces, holocaust survivors, school children, hospital patients, the elderly and infirm, incarcerated prisoners, and even the dead. In addition, our cases show a troubling change in the nature of these cases, away from traditional white collar criminals to more violent criminals, like gang members and narco-traffickers, who are using stolen identity refund scams to fuel their other, violent, criminal activities. We will continue to crack down on identity thieves who are lining their pockets with our tax dollars and using violence to obtain the personal identification information of others.”
“Today’s announcement should reassure American taxpayers that IRS Criminal Investigation has put into action our pledge to make investigating identify theft and refund fraud a top priority,” said IRS Criminal Investigation chief Richard Weber. “Be assured that we are serious about investigating these crimes and, as we capitalize on the collective strength of the Identity Theft Tax Fraud Strike Force, we will succeed in vigorously pursuing the criminals who steal from the American taxpayer.”
7 Comments
I would be more concerned with a person preparing my taxes that cannot read this article and realize it is about 'Tax Fraud' and did not elicit a response about rapid refund loans?!? Hello
Posted by: tomames | October 18, 2012 1:44 AM
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Lets see......a $5000 loan for, lets say, one week. $100 charged for one week would be 2%. Now lets annualize that 2% and, lo and behold, it comes to 104%! That's not a rip-off of the poor? Sorry, I don't agree with you and I won't do rapid refunds.
Posted by: cherylrein | October 16, 2012 7:44 AM
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This Identity Theft has nothing to do with 'those' Rapid Refunds. 'Those' rapid refunds were offered to individuals who are unable to get a loan from a traditional bank. If you're not familiar with them years ago you were about to get about a $5,000 loan against your refund. Those clients paid on the average of $105 in finance fees. If the IRS didn't fund that client's refund the bank was out the money; not the US Treasury. Can you get a $5,000 loan for $105 in interest? I think not. Furthermore, when individuals are coming into a tax office, at least mine, they provide us with two forms of ID; a valid picture government issued ID and their SS card.
Today's hijacking of individual's tax refunds is from a lack of government oversight. You can purchase a tax program off the shelf, or visit the IRS website to file your taxes for 'free'. These individuals sit in the comfort of their own homes filing these fraudulent tax returns b/c no one is there to verify the information.
Perhaps these 'gift' cards that these fraudent refunds are being downloaded on should somehow have a name, address and state id imbedded in them when you purchase them so it can be tracked back to an individual.
I have clients too that have had their identity stolen and tax returns filed fraudently. Its extrememly sad when you tell them there is no fast fix to this.
And you're right Cherylrein ...the penalty for this type of crime needs to be servere and no release for good behavior...
Posted by: jkwizner | October 15, 2012 1:57 PM
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Too little, too late, in my opinion. My poor clients who have been victims are the ones who have suffered. It takes YEARS to get these identity theft problems straightened out. Apple can do amazing things with technology - why not the IRS? Let's have extremely severe jail time and penalties for these scum bags and lets get some common sense into preventing fraud BEFORE not after. Just getting rid of this horrible, rip-off rapid refund would be a start.
Posted by: cherylrein | October 15, 2012 12:18 PM
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If the IRS put as much effort into this as they have put into their offshore jihad and FATCA, they would probably generate a lot more revenue and it would be time better spent. Instead, they have misplaced priories and resources trying to make the rest of the world be the U.S. tax collectors, rather than focus solely on the homeland problems like in Florida. The 10 year returns on this effort are much higher than the FATCA effort. This is just a meager start to polish the resume of Shulman has he exits to a lucrative consulting job in DC.
Posted by: Just Me | October 15, 2012 11:04 AM
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What is "Financial ICONN?"
Posted by: tego@verizon.net | October 15, 2012 10:56 AM
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The IRS said they will vigorously pursue identity thieves who commit tax return fraud. That's a good start but what about preventing fraud BEFORE it happens?
Financial ICONN is the most effective way to prevent fraud. If the IRS would activate the ICONN of anyone filing taxes, the IRS would know without a doubt that the right person is receiving the return. With ICONN, criminals have no way to impersonate someone else.
Simply put, the IRS doesn't have any way to establish an identity with confidence, until now. Financial ICONN is the way.
Posted by: Kev | October 12, 2012 2:16 PM
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