“For the public the risk is clear,” Keneally said. Such crimes “can and do arise in any setting where the lure of fast money puts at risk personal identifying information, including at state agencies, student loan providers, the military, prisons, companies servicing Medicaid programs – the list is growing all too long.”
Postal workers have been compromised, robbed and in one case killed in order to steal refund checks, she said.
Prosecuting tax-refund identity theft is a national priority, she added.
Legislation Nelson introduced this week would increase jail time and fines for people convicted of tax-related identity theft and direct the IRS to close identity theft cases within 90 days. Last year, it took an average of 196 days for the IRS to close such cases.
The delays are unacceptable, Nelson said. He said victims of identity theft shouldn’t have to wait six months for their refunds, much less two years, as at least one woman in Parkland, Fla., had to do.
“Many Americans rely on getting those tax refunds back so they can pay their bills,” he added.
Nelson’s bill, co-sponsored by fellow Democratic Sens. Dianne Feinstein of California and Charles Schumer of New York, also would ensure that victims don’t have to explain their plight to different IRS employees every time they contact the agency. Instead, the IRS would give each victim a single point of contact to help track the case.
Other provisions include restrictions that would make it harder for thieves to load stolen refunds onto prepaid cards, language that allows identity theft victims to opt out of electronic filing and prohibitions on printing Social Security numbers on Medicare ID cards and communications.