Taxpayers continue to receive calls from scammers posing as employees of the Internal Revenue Service, while the agency itself is being criticized for its failure to protect sensitive taxpayer information.
On Wednesday, the IRS reissued a warning to consumers based on 90,000 complaints the government has received about fraud that has caused some 1,100 individuals to lose an estimated $5 million.
“There are clear warning signs about these scams, which continue at high levels throughout the nation,” said IRS Commissioner John Koskinen, in a press release.
“A big red flag for these scams are angry, threatening calls from people who say they are from the IRS and urging immediate payment. This is not how we operate. People should hang up immediately,” Koskinen explained.
In March, J. Russell George, the Treasury Inspector General for Tax Administration (TIGTA) called the situation “the largest scam of its kind that we have ever seen.”
At the time, some 20,000 complaints had been made about the fraud.
In other news, the government shared a report recently that disclosed more than a dozen cases in which the IRS awarded contracts that required access to taxpayer information without mandatory and complete background investigations of employees working for the outside contractors.
“Allowing contractor employees access to taxpayer data without appropriate background investigations exposes taxpayers to increased risk of fraud and identity theft,” said George, in a statement released Thursday.
Of 28 contracts reviewed, the inspector general’s audit revealed five cases in which contractors had not had any background checks. For instance, a contractor working on printing and mailing tax forms was given a disk containing 1.4 million taxpayer names, Social Security numbers and other personal information.
In addition, TIGTA says it identified 20 contracts for which some contractor personnel did not sign nondisclosure agreements. The IRS subsequently issued more explicit guidance requiring the execution of nondisclosure agreements.
“Americans deserve to have their personal information treated securely and with discretion, and the IRS should follow the policies that are there to protect taxpayers from fraud and identity theft,” Rep. Diane Black, R-Tenn., said in a public statement on Thursday.
TIGTA outlined five recommendations to the IRS. The IRS agreed with four of them, but disagreed with a plan to review a waiver that exempts expert witnesses from background investigations.