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IRS cracks down on fraud as tax return season begins

January 31, 2012|By Matt Stevens
  • The IRS identified about 260,000 fraudulent returns last year.
The IRS identified about 260,000 fraudulent returns last year. (Daniel Acker/Bloomberg )

As most folks start preparing to file their income tax returns, the IRS and the Justice Department began unveiling their annual reminders of what happens to those who don’t. 

The Internal Revenue Service said Tuesday that federal authorities in an extensive sweep across 23 states last week charged 105 people of fraud and identity theft in connection with filing false returns to try to obtain refunds.

“ID theft is a growing problem all across the country, and we’ve come to find out that the tax system isn’t immune,” said IRS spokeswoman Anabel Marquez. “They’ve figured out that just like they can steal credit card numbers, they can file false refunds.”

Altogether, last week’s sweep resulted in 939 criminal charges lodged in 69 grand jury indictments and criminal complaints filed by prosecutors.

In that sweep, authorities arrested three Southern California residents – Thomas Marshall, 36, of Lancaster; Michael Williams, 41, formerly of Littlerock in the Antelope Valley; and Mike Niko, 33, of Carson – on suspicion of identity theft and tax fraud. All three pleaded not guilty and were released on a $50,000 appearance bond, according Linda Lowery of the IRS' criminal investigation unit in Los Angeles.

Also named in the indictment were Veronica Niko, 35, of Lancaster, who was not arrested but has been summoned to appear in court next week, and Mao Niko, 39, formerly of Gardena, who remains at large, Lowery said. She said it was unclear if the Nikos are related.

Also last week, IRS enforcement agents checked 150 money services businesses in nine high-risk metropolitan areas, including Los Angeles, to see if they knowingly or unknowingly facilitated identity theft or refund fraud. The IRS has more than 250 check-cashing operations under audit across the country.

The agency also is devising new identity theft screening filters to help agents spot fraudulent returns before they are processed and a refund issued.

Marquez said the IRS identified about 260,000 fraudulent returns last year.

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