Identity theft used to be something that happened to other people.  But today, you could be one of the “other people”…all because it’s tax time.  Today’s fraud comes from a CBS Miami story, but it really could have come from anywhere.  And that’s the point of the story:  identity theft and tax refund fraud are a “national problem” that we can’t afford to ignore.  (Don’t kid yourself, this is a national epidemic)

The article starts by addressing the issue in Florida, noting that a recent Federal Trade Commission (FTC) report says that South Florida has had more identity theft occur than anywhere else in the nation.  But it quickly focuses on the broader problem, (Here’s the ugly part) citing figures from the General Accountability Office (GAO) that show a sharp increase in “tax refund complaints” related to identity theft.  In 2008 the federal government had 52,000 tax refund complaints and two years later that number had increased to 250,000 per year.  Now the numbers are startling:  the FTC says it receives 50,000 identity theft complaints per week.  (Let’s take a quick look at this:  2008=52,000, 2010=250,000, and 2012=2,500,000.  This is about 50 X growth in four years.  Companies dream of this type of growth.  Criminals are actually getting it, and it’s with YOUR money.)

The U.S. Attorney for South Florida described how serious the issue has become, stating:  “It is now an epidemic…It is viral, it is spreading not only here in South Florida, but throughout the country.  And we’re dealing with hundreds of millions of dollars if not billions of dollars of loss, to the IRS and to the government.”

  1. I think the IRS should verify each tax return it receives. I know this sounds daunting, however, it would still cost far less to employ more staff to handle the workload than the thiefs make off with. Verify each return before issuing a refund. It just seems like it would be easier to do than to try and recover the stolen money after the fact. Who cares if it takes longer to get our refunds if it means our hard earned tax dollars won’t be stolen. Accountability is a facter here as well. The Federal Government is responsible for our tax dollars and if they can’t handle the job, privatize it! Make the government justify spending our tax dollars before it is handed over to them to spend. This would include tax refunds.

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