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IRS fight fraud/identity theft

Posted: Fri Jun 12, 2015 6:50 pm
by NYGman ... revention/

The IRS has just revealed a collaboration with various tax-preparation firms and software companies such as Intuit that aims to prevent refund fraud. It will introduce new safeguards to authenticate a person's identity, including monitoring and flagging repetitive use of IPs and reviewing a device's identifying info. The IRS website will also take note of how much people spend to complete a tax return to prevent bots from submitting them and will capture metadata that can be used to investigate filings. In addition, everyone involved will regularly share (anonymous) data and fraud leads among themselves in an effort to be more effective in identifying suspicious activities.

From the looks of it, the IRS has finally learned its lesson: just recently, the agency admitted that the tax data of 100,000 people were stolen from its transcript website. That eventually led to $39 million worth of fraudulent tax refund requests, which the government is blaming on Russia. The Treasury Inspector General for Tax Administration (that keeps an eye on the agency) said all these happened, because the IRS shrugged off the security upgrades it recommended.

According to The New York Times, IRS commissioner John Koskinen has admitted this at a news conference:

We have come to realize we are now dealing with a much more sophisticated enemy than in the past. It's clear that criminals have been able to gather increasing amounts of personal data as the result of ongoing data breaches at various sources outside the tax system.
The group plans to roll out the new security measures, along with campaigns to raise awareness about identity theft soon. It expects to be done before the April 15 filing deadline in 2016 to keep people's newly submitted documents safe. ... .html?_r=0 <-- May be a paid link

I think it is about time the government used soem technology to crack down on fraudulent filings and Identity theft. I think this is a move in the right direction.

Re: IRS fight fraud/identity theft

Posted: Sun Jun 14, 2015 2:19 pm
by operabuff
The IRS has been using technology to try to defeat identity theft for quite a while. But several things work against them. First, there's a countervailing pressure to get refunds out quickly during filing season. Second, their budget has been slashed. And third, it's always tricky to play defense. Still, it's obvious that they need to step up their game. Let's hope that Congress gives them the resources to do it.

On a side note, I was interested to see this in the NYT article:

Stephen M. Ryan, of the American Coalition for Taxpayer Rights, a trade association representing some of the largest tax preparation firms,
(my emphasis)

Seems inconsistent for a group of tax prep firms to call themselves reps for taxpayer rights. The main taxpayer right they're interested in is the right to pay too much money for tax return preparation. They probably advocated in favor of refund anticipation loans. Sort of like an association of cattlemen calling themselves "People for the Ethical Treatment of Steers".