Federal agents call them SIRF cases – for Stolen Identity Refund Fraud. The scam, calculated to cheat the IRS of an estimated $6 billion – with a “b” – every year, is flourishing here in the 24/680.
In essence, organized criminal groups or lone wolves with a few precious bits of personal information are beating law-abiding taxpayers to the punch when it comes to filing their returns – and collecting their refunds.
The crime itself is not particularly hard to pull off and can be hard to track, which is why criminal enterprises who once specialized in running drugs or burglarizing homes are turning to it in increasing numbers.
And the perpetrators are not sophisticated computer wizards. In many cases they have proven to be dropouts and social failures who have, unbelievably, managed to amass millions in ill-gotten funds from the IRS and innocent people left to untangle messy credit and tax histories that can haunt them for years.
How It Works:
Thieves access a list of stolen identities available to them via a variety of “dark” sources. They go to one of dozens of tax preparation sites online and, using stolen social security numbers and birthdates, they fill out a bogus W-2 form, claiming a refund of a few thousand dollars. The scammer then tells the IRS where to send his or her refund – usually wired to a bank account or loaded onto a prepaid debit card. Repeat the process multiple times in the course of a day and thieves were raking in tens of thousands of dollars – often within a seven day window.
Many lay the blame for the proliferation of the con squarely on the government and the IRS, saying they are not prosecuting the perpetrators vigorously enough. On the odd occasion when the scammers are caught they have proven to be a lot like Rashia Wilson, a Tampa, Fla. woman caught and convicted for SIRF crimes in 2013.
Prior to her arrest, Wilson was so bold as to taunt local authorities about her prowess as a tax fraudster, posting to Facebook and Instagram with messages like this one:
“I’M RASHIA, THE QUEEN OF IRS TAX FRAUD… I’m a millionaire for the record, so if U think indicting me will B easy it won’t, I promise you! U need more than black and white to hold me down N that’s to da rat who went N told, as if 1st lady don’t have da TPD under her spell. I run Tampa right now.”
The “queen’s” empire collapsed and she is now a guest of the government at Aliceville Federal Correctional Institute in Alabama, but there have been thousands of others willing to take her place, apparently.
It angers me that the IRS did not voraciously pursue these fraud people…. as they would certainly pursue you and I taxpayer.
Much of this fraud is related to the Earned Income Tax Credit which pays out “refunds” much greater than aggregate taxes withheld from paychecks (which is by design). The above story covers a flagrant and organized case, but the problem is widespread. About 25% of payments from the government are fraudulent. Wrap your head around that. The challenge is that aggressive fraud prevention measures are politically problematic because it makes it harder for the working poor to get their cash assistance.
http://www.accountingweb.com/tax/irs/report-irs-made-up-to-156-billion-in-faulty-eitc-payments-in-2013
Maybe she’ll be able to get her GED in prison.
So much of this happening right now. Phone calls saying we owe money – pay up or else go to prison? Boy would I like to catch one of these suckers — I wud teech them a thng o 2!