350,000 taxpayer accounts were accessed by “unauthorized” individuals.

The Washington Post reported in September that more than 350,000 taxpayer accounts were accessed by “unauthorized” individuals, 610,000 accounts were at a “heightened risk of identity theft,” and that even those figures don’t speak to the amount of accounts vulnerable to cyber thieves. What happened?

The story goes back to 2011 when the Treasury Inspector General for Tax Administration informed the IRS that while they were in a “unique position to identify employment related identity theft,” it did not have a system or procedure in place capable of notifying individuals when theft or tampering took place. So, from February 2011 until 2015, upon the inspector general’s recommendation for closer scrutiny, the IRS found over one million cases of identity theft. In 2014, the IRS began a pilot program with the aim of notifying individuals. The pilot program, called “Get Transcript,” was designed to allow taxpayers directly access, view, and print their IRS account within 5 minutes.  As it turns out, this information was also able to be accessed by thieves and the “Get Transcript” pilot program was halted.

Receipts and tax forms.


Prevention Is Becoming More Difficult

These revelations are alarming and they are another reminder of the increasing threat posed by identity theft. As more cases are exposed and reported, it is clear that cyber thieves are becoming more sophisticated with their methods. Prevention is becoming more difficult, which means that quickly identifying foul play is all the more crucial to protecting information and preventing substantial damage.

While the IRS will continue to address this gap in account security (The Washington Post reports that they will initiate a third update of a program called “Einstein” by the end of this year), it is apparent that we shouldn’t rely on banks, institutions, or the government to protect or notify us of theft in a timely manner.

We’ve discussed ways to protect yourself from different forms of identity theft in some of our other blogs.  Recognizing and responding to this form of identity theft is more difficult than others. To learn the proper way to respond, you can visit the “Tax Payer Guide to Identity Theft” page set up by the IRS. It provides the proper information you need to address this type of fraudulent activity.

As always, if you have any questions about credit fraud or identity theft of any kind, please contact us.  

Kellam T. Parks
Managing Member of Parks Zeigler, PLLC
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