Tax refund theft a new trend in identity crimes
Left, Danny Fink, a former New York City firefighter, was the victim of tax refund fraud.
This year when Danny Fink went to file for an extension on his tax refund he found out something that millions of Americans are learning the hard way.
“My extension was denied because they said I already filed my taxes, but I hadn’t,” said the Pickens resident. “Someone took my identity and they made up some numbers and got a refund in my name. The IRS told me this would take anywhere from 18-24 months to straighten out.”
Fink, a former New York City firefighter who was injured in the 9/11 attack, had accumulated about $20,000 in medical bills and was put on disability because of the 2001 injuries. He said he hasn’t received a refund in several years because of his disability status and wasn’t expecting one this year “so I wouldn’t have gotten anything back, but it’s still a huge pain.”
Ironically, Fink first learned about tax refund theft, a crime that is quickly gaining popularity, not long before it happened to him. While watching “NBC Nightly News with Brian Williams” he discovered that by gaining access to a few pieces of personal information, criminals can steal a person’s identity, file a tax return in their name, and have a phony refund mailed or transmitted to them electronically.
This particular episode profiled a fire department in Florida where nearly all of the employees had their tax returns falsified, many for multiple years in a row.
Fink said after he was told his 2012 returns had been illegally filed by someone else, he quickly filed a report with the Pickens County Sheriff’s Office.
According to Pickens County Sheriff’s Office Lieutenant Kris Stancil, tax refund theft is often the first time people realize they are victims of identity theft.
“Most often than not people discover their identity has been stolen during tax time,” Stancil said. “If they filed their taxes they use the number and the real person can’t file their taxes.”
According to Stancil, there have been 17 cases of fraud that were related to tax returns filed in Pickens since the beginning of 2013.
Stancil also said tracking down the perpetrator in identity theft cases can be a challenging undertaking.
“Oftentimes the main criminal will have a ‘mule,’ which is someone who will receive the check and keep a percentage,” Stancil said. “The culprit is not oftentimes in the United States. Prosecuting these people is almost impossible. It would take a massive tracking effort. If you talk to them on the phone and they’ll say there’s nothing you can do. It’s out of your jurisdiction.”
The IRS, which has its own criminal investigation department, handles their own fraud cases. With the rise in tax refund theft, which the acting IRS Commissioner Steve Miller called “one of the biggest challenges facing the IRS today,” they are ramping up their efforts to combat the problem.
By late 2012, the IRS assigned more than 3,000 IRS employees — over double from 2011 — to work on identity theft-related issues.
Here are some tips Stancil provided for protecting your identity, and saving yourself a lot of headache:
•Be careful where you use your personal identification including social security, name and date of birth. If they have this information they can take your identity. You can apply for credit cards and a variety of other things.
• Anytime your Social Security number, name or date-of-birth is written down, be sure to shred the document.
If you do become a victim of identity theft, report it immediately. The sooner you make the report the more likely it is for the criminal to be tracked down.
You can learn more about the IRS’s effort to crack down on tax fraud at www.irs.gov