Taxpayer ID Theft is Soaring, GAO Report Finds
The GAO findings, obtained by The Associated Press, don't begin to describe the pain for a first-time victim, who must wait for a refund while the IRS sorts out which return is real and which is a fraud.
Many identity thieves don't get prosecuted, according James White, director of strategic issues for the GAO.
"IRS officials told us that IRS pursues criminal investigations of suspected identity thieves in only a small number of cases," White says in testimony prepared for a House Oversight and Government Reform subcommittee.
He said that in the 2010 fiscal year, the IRS criminal investigations division initiated just over 4,700 investigations of all types — far less than the identity theft cases alone.
"We want to know why this problem is apparently getting much worse," said Rep. Todd Platts, R-Pa., chairman of the subcommittee. "By bringing these issues to the public as quickly as possible, the committee hopes to give citizens the necessary information so they can protect themselves from such identity theft."
IRS Commissioner Douglas Shulman, in his prepared statement, defended the investigation record. He said his criminal division concentrates on schemes of national scope and added that 95 percent of those prosecuted for refund-related identity theft go to prison.