FBI Investigating Tax Returns Fraud

FBI Tax FraudYahoo Finance has reported on the ongoing investigation initiated by the FBI after US States Departments of Revenue reported criminal activity that affected a lot of taxpayers. Many people in various states were not able to file their 2014 income tax returns through Turbo Tax, the well-known Intuit Inc. software, because these returns were already filed by tax scammers in an attempt to get fraudulent tax refunds.

The FBI agents are trying to determine how tax criminals got an access to people’s personal information. Intuit Inc. has already looked into this problem and could not find any evidence of a security breach in Turbo Tax, but the FBI needs to conduct its own investigation. Because this particular fraud did not affect those computer filing programs that don’t allow users to file their state returns until their federal returns are submitted, experts expressed an opinion that the IRS filing system is not as vulnerable. However, the FBI doesn’t exclude the possibility that this same fraud also affected federal taxpayers. In fact, some Turbo Tax users have informed The Wall Street Journal that someone filed fraudulent federal tax returns on their behalf.

In response, the IRS spokesman stated that the IRS has strengthened security around return processing, and advised US taxpayers to continue filing federal tax returns as usual. According to the IRS, this is not a new problem; in 2013 US Federal government paid about $5.2 billion in fraudulent refunds that tax criminals were able to request by using stolen personal information from American taxpayers. However, the IRS was able to recognize the fraud in many other cases, which saved the government $24.2 billion.

Departments of Revenue in many US states responded by conducting extra screening of each filed return for the possibility of tax fraud. As a result, some of the refunds are now pending while taxing authorities verify taxpayers’ information and the validity of filed returns.

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