A blistering new report concludes what many in local law enforcement already know: Florida is a hotbed for tax fraud—and Tampa is number one.
A Treasury Department auditor reviewed IRS tax forms filed in 2011 and discovered that 88,724 fraudulent refunds originated in Tampa. Other cities in the top five include Miami, Atlanta, Detroit, and Houston.
Thieves are using identity theft to bilk the Internal Revenue Service. Their take in Tampa alone was $468 million, according to the report. The nationwide loss is $5.2 billion.
One of the most startling facts in the report is that the IRS sent 518 refunds to a single mailing address in Tampa. The total amount send reached $1.79 million.
The IRS declined to disclose the address. The auditor's office said that information is covered under a confidentiality provision in federal law that protects the privacy of a tax filer – even if he or she is breaking the law.
A different address in Lansing, Michigan received even more refunds. The IRS sent 2,317 refunds to a single address totaling $3.3 million.
A law enforcement official said both address were homes – and both had been vacated by the people who had received the refunds.
The auditor's report also reveals that the IRS has repeatedly sent multiple refunds to a single bank account—often in someone else's name. The report found ten instances in which the IRS transferred more than 300 refunds to a single bank account via direct deposit.
The reports concluded crooks could steal another $10 billion in the next five years.
To address the rampant fraud, the auditor recommended the IRS impose limits on the numbers of refunds that can be sent to a single address or bank account by direct deposit.
In a written response to the report, an IRS official said it agreed with the recommendation and that it is taking steps to combat id-theft and tax fraud.
A spokesperson for the auditor said it will be auditing the IRS on an ongoing basis. A spokesperson said Senator Bill Nelson (D-FL) requested the audit.
LINK: Read the full report here. (Scroll to page 10 for information specific to Tampa.)
From FOX 13's Jeremy Campbell:
Tax fraud is a rampant problem across the country, but especially right here in Tampa. The rest of the country now knows that Tampa is number one in stolen identifies and tax fraud.
The IRS seems helpless to do very much about it. It's all outlined in a report released Thursday by the Treasury Department.
The short answer is it's easy to steal names and grab your tax return. It's adding up to billions in fraud.
Tampa had 88,724 fraudulent tax returns filed last year, beating out Miami, Atlanta, Detroit, Houston and every where else.
"We've estimated millions of dollars just in Tampa so talking about the entire country, yeah we believe these numbers are very conservative and it's probably more widespread," said Andrea Davis with Tampa Police.
The total fraud nationwide is 1.5 million fraudulent returns and $5 billion stolen from the federal government.
This is after cities like Tampa have already cracked down.
"Unfortunately, this is something that we've been talking about for nearly three years and hopefully this report is something that's needed to see changes be made at the filing level so we aren't dealing with this in future tax seasons," Davis said.
At one house in Tampa, refund cards were mailed not just one time, but 518 times to one address. It totaled $1.79 million.
The problem is nationwide. In Lansing, Michigan, one address received more than 2,100 refunds. Orlando had more than 700.
How do you protect yourself? We asked an accountant who was once a tax fraud victim herself...
The short answer is avoid identity theft.
"If you've heard of phishing before there's a lot of phishing scams out there. People will get an e-mail and they're saying they are from the IRS asking for personal information from that person and the person responds to it and that person is actually committing fraud and they're using their information to do fraudulent things with it," said Suzanne Cox with Salt Marsh CPA.
FOX 13 / WTVT-TV
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