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Obama’s IRS Urged Employees to Ignore Fraud from Immigrants

Posted by FactReal on August 9, 2012

The Washington Times reported yesterday:

IRS supervisors ignored employees who tried to warn agency higher-ups of fraud in a program designed to collect taxes from immigrants, resulting in the agency paying out potentially bogus refunds, according to an official audit released Wednesday.

The Treasury’s inspector general for tax administration (TIGTA) said the IRS is too focused on getting out refunds quickly rather than getting them only to qualified taxpayers. Auditors also said the agency eliminated some methods employees had used to figure out questionable refund requests and doesn’t have the right training or tools to screen out bogus identity documents when immigrants apply for taxpayer numbers.

“TIGTA found an environment which discourages employees from detecting fraudulent applications,” said J. Russell George, the inspector general.

In the wake of the finding, one congressman called on the IRS commissioner to resign.

IRS pays out $6.8 billion in refunds to taxpayers who file using Individual Taxpayer Identification Numbers (ITINs). They generally are immigrants, here both legally and illegally. The potential amount of fraud was not stated, but the investigators detailed seven schemes that paid out $9 million in tax refunds in 2011. […]

The auditors took a closer look at fraud after being prompted by senators, who said they had heard complaints from IRS employees that their warnings were being ignored.

Mr. George confirmed that, saying IRS supervisors were urging employees to turn their backs on potential fraud from identity theft.

…[I]nvestigators said the IRS issued 23,994 refunds to one address in Atlanta, totaling $46 million in refunds.

And one single bank account was issued 8,393 refunds totaling $236,747, while another account was issued 2,706 refunds totaled $7.3 million in 2011.

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