On Thursday the IRS announced a massive nation-wide identity theft crackdown, and I believe I’m starting to see a pattern now. Around the end of December each year we tend to get together with our extended families to drink eggnog, decorate trees, exchange gifts, and engage in various other annual family traditions. Well, the IRS appears to have a tradition of its own, although far less jolly than ours. Each January the IRS gets together with the Department of Justice and the US Attorney to sweep the nation for tax cheats — not exactly the kind of party you want to be invited to.
Here are the results of this years’ festivities:
- the “sweep” involved 32 states and 215 cities
- 734 enforcement actions (2,400 total in fiscal year 2012)
- 109 arrests
- 189 indictments
- 47 search warrants
- visits to 197 money service businesses (i.e., check cashing joints)
Read about specific cases here.
There is no doubt the IRS is strengthening its identity theft prevention and prosecution efforts. Last year there were only 69 indictments and 58 arrests. Sentencings are also on the rise, and jail times are getting longer.
The IRS is spending an unprecedented amount of resources on identity theft. Perhaps the best evidence is the dramatic increase in criminal identity theft investigations:
- 276 criminal identity theft investigations started in 2011
- 898 criminal identity theft investigations started in 2012
- 560 criminal identity theft investigations started so far in 2013
I’m not sure how they would do it, but the IRS could probably do a better job publishing this information and these stats. It’s great that they’re stepping up efforts to punish identity theives, and the timing is perfect (right as people begin getting their taxes done), but if it’s only the tax attorneys and other tax professionals who are in the know, I would consider it a big opportunity lost.