This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
The federal government has swooped down on 105 people in 23 states as part of a nationwide crackdown on identity theft and tax-refund fraud that was timed to warn cheats and potential victims to beware this tax season.
The upshot is that if you haven't filed your tax return yet, someone may have filed it for you. At one Internal Revenue Service office in Florida, at least a dozen tax filers said they spent hours in line to report someone had already filed their returns.
The IRS announced that 105 people in 23 states had been targeted as part of a national identity-theft crackdown, which took place in late January involving the potential theft of thousands of identities and taxpayer refunds.
The sweep ranged from Alaska to Florida and resulted in 80 complaints and indictments, 58 arrests and 939 criminal charges. The effort has already produced a handful of guilty pleas and sentencings. Besides the IRS, the Justice Department's Tax Division, the Postal Service and local U.S. attorney's offices were involved after investigations that lasted months and, in some cases, years.
IRS officials say the use of stolen identities to fraudulently file for tax refunds, generally involving stolen Social Security numbers, is a growing problem. Last year the agency says it found 260,000 income tax returns with confirmed attempts at identity fraud and blocked the payment of $1.4 billion worth of refunds. In 2010, the IRS says it detected identity fraud in 49,000 returns and prevented the payment of $247 million worth of bogus refunds.
"The timing is not coincidental," Steven Miller, the IRS's deputy commissioner for services and enforcement told reporters. "It's the start of tax season, this is a large issue, and we want to send a message out there."
Miller said schools and hospitals are a common source of stolen Social Security numbers.
The cases included three women from Dayton, Ohio, who were accused of getting tax refunds by using identities stolen from mentally disabled adults; and a Colorado Springs, Colo., man, who was charged with stealing identities of the clients of a company that had gone out of business to fraudulently file for tax refunds.
The IRS has been dealing with a five-fold increase in taxpayer identity theft that began in 2008, a Government Accountability Office official told a House hearing last summer. Incidents spiraled from about 52,000 in 2008 to nearly 250,000 in 2010.
Over the past week, IRS officials have also visited 150 money services businesses to see if they are involved in identity theft or filing for bogus refunds. This sweep was conducted in nine metropolitan areas it considers high risk: Atlanta; Birmingham, Ala.; Chicago; Los Angeles; Miami; New York; Phoenix; Tampa; and Washington, D.C. In addition, the agency is auditing more than 250 check-cashing operations around the U.S. to try to spot any identity-theft activity.
The IRS already has announced that some early taxpayers who filed on or before Jan. 25 may have to wait a week longer than expected because of new anti-fraud safeguards being installed on computer systems that required "fine-tuning." Miller said he does not expect those delays to last. —
For more information on the sweep
The nationwide effort by the Justice Department and the IRS led to actions in 23 locations across the country. A map of the locations and additional details are available on IRS.gov and the IRS Civil and Criminal Actions page 1.usa.gov/xD9QmV. —
Steps taxpayers can take
The IRS has created a special section at IRS.gov dedicated to identity theft matters, including YouTube videos, tips for taxpayers and a special guide to assistance. The information includes a contact number for the IRS Identity Protection Specialized Unit (800-908-4490) and tips to protect against "phishing" schemes that can lead to identity theft.