IRS gets hacked, pays out $50 million in false claims

The IRS announced yesterday that over 100,000 tax returns have been fraudulently accessed through the agency’s website by “organized crime syndicates”, in order to apply for refunds. 200,000 attempts were made by the hackers from February-May to obtain the old tax returns using stolen personal information (SS#’s, birth-dates, addresses).

In all, 15,000 fraudulent claims were processed by IRS, resulting in refunds totaling approximately $50 million. This is not a new problem for the tax-collecting agency however, as $5.8 billion was paid out to phony refund claims in 2013.

The “Get Transcript” application on the IRS website allows individuals to obtain past years’ tax forms which are sometimes required to apply for loans.

Senate Finance Committee Chairman Orin Hatch (R-UT), did not take the news lightly, commenting, “That the IRS…was vulnerable to this attack is simply unacceptable. What’s more, this agency has been repeatedly warned by top government watchdogs that its data security systems are inadequate…”

Since the Republicans took control of the House of Representatives in 2010, the IRS’ budget has been cut by 18% and has let go over 13,000 employees.


[New York Times]