It's a sad statistical fact that when data breaches or business identity theft occur, a failure of internal safeguards is often to blame-partially or entirely. Often, organizations or companies leave themselves-and their customers-open to attacks by identity thieves and hackers because they haven't done enough to prevent those attacks. The same may be true of at least one government agency, a new report reveals.
A recent report by the Government Accountability Office, Congress' investigative agent, pointed to multiple deficiencies in how the IRS handles its business-and more than one of those issues speaks directly to identity theft risks and fraud.
The GAO said that as a result of its audit of the IRS's 2012 fiscal year financial statements, it uncovered problems with how the tax service estimates federal taxes it should be receiving and how much it should be paying out.
IRS internal controls aren't effectively ensuring that tax refunds don't go to dead people, the GAO cited in a list of concerns. Identity thieves commonly commit tax fraud by filing for refunds using the Social Security numbers of deceased taxpayers. The GAO reviewed refunds sent to dead taxpayers in 2012, and found that 88 percent were invalid-many because of identity theft.
Tax fraud and tax identity theft are growing concerns. In 2010, the most recent year for which figures are available from the Federal Trade Commission's Sentinel Network Data Book, tax- or wage-related fraud made up 15.5 percent of the nearly 251,000 identity theft complaints reported to the FTC. It was the most common type of identity theft reported that year, and had increased 12.7 percent from the previous year.
The GAO also took the IRS to task for employee-related issues. Specifically, the GAO said IRS procedures were ineffective in ensuring that IRS workers allowed to approve issuing a manual refund were properly appointed. And, other workers' access to sensitive taxpayer information was not effectively limited. In the corporate world, employees acting irresponsibly or criminally can cause or contribute to data breaches, fraud and outright theft.
In addition to tax fraud issues, another point of concern was ineffectively designed policies and procedures that employees are supposed to follow to record the purchase of goods and services, the GAO report said.
What's more, the GAO said, as of Sept. 30 of last year, the IRS had resolved only 23 of 69 recommendations the GAO had made after its 2011 audit of the tax service.
A recent report by the Government Accountability Office, Congress' investigative agent, pointed to multiple deficiencies in how the IRS handles its business-and more than one of those issues speaks directly to identity theft risks and fraud.
The GAO said that as a result of its audit of the IRS's 2012 fiscal year financial statements, it uncovered problems with how the tax service estimates federal taxes it should be receiving and how much it should be paying out.
IRS internal controls aren't effectively ensuring that tax refunds don't go to dead people, the GAO cited in a list of concerns. Identity thieves commonly commit tax fraud by filing for refunds using the Social Security numbers of deceased taxpayers. The GAO reviewed refunds sent to dead taxpayers in 2012, and found that 88 percent were invalid-many because of identity theft.
Tax fraud and tax identity theft are growing concerns. In 2010, the most recent year for which figures are available from the Federal Trade Commission's Sentinel Network Data Book, tax- or wage-related fraud made up 15.5 percent of the nearly 251,000 identity theft complaints reported to the FTC. It was the most common type of identity theft reported that year, and had increased 12.7 percent from the previous year.
The GAO also took the IRS to task for employee-related issues. Specifically, the GAO said IRS procedures were ineffective in ensuring that IRS workers allowed to approve issuing a manual refund were properly appointed. And, other workers' access to sensitive taxpayer information was not effectively limited. In the corporate world, employees acting irresponsibly or criminally can cause or contribute to data breaches, fraud and outright theft.
In addition to tax fraud issues, another point of concern was ineffectively designed policies and procedures that employees are supposed to follow to record the purchase of goods and services, the GAO report said.
What's more, the GAO said, as of Sept. 30 of last year, the IRS had resolved only 23 of 69 recommendations the GAO had made after its 2011 audit of the tax service.