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Theft at IRS: Loss of Information for 100,000 Taxpayers

May 28, 2015

Tax thieves broke through the security of an IRS system called ‘Get Transcript’ and accessed tax filing information of more than 100,000 taxpayers. Get Transcript is a service run by the IRS that allows taxpayers to access information about their previous years’ tax returns.

With this filing information now in the hands of tax thieves, there is a high risk that the thieves may file fraudulent tax returns in the future, and carry out other financial crimes using the stolen information. Of the roughly 200,000 retrieval attempts, about 100,000 were successful.

“We’re confident that these are not amateurs,” said IRS Commissioner John Koskinen. “These actually are organized crime syndicates that not only we but everybody in the financial industry are dealing with.”

The agency was alerted when they noticed the high number of taxpayers that were requesting transcripts. However, this could not stop the theft of the tax information of more than 100,000 taxpayers.

“Eighty percent of the of the identity theft we’re dealing with and refund fraud is related to organized crime here and around the world,” Koskinen said. “These are extremely sophisticated criminals with access to a tremendous amount of data.”

With data thieves using sophisticated technology to infiltrate online security systems, the IRS must adopt methods to make their systems full proof.

“That the IRS — home to highly sensitive information on every single American and every single company doing business here at home — was vulnerable to this attack is simply unacceptable,” said Sen. Orrin Hatch, R-Utah, chairman of the Senate Finance Committee. “What’s more, this agency has been repeatedly warned by top government watchdogs that its data security systems are inadequate against the growing threat of international hackers and data thieves.”

After the theft, the agency shut down the Get Transcript service temporarily. Taxpayers that need their past years’ tax filing information may request transcripts by mail. The IRS’ main computer systems that handle tax filing are untouched by this “breach” and are secure.

In 2013, the IRS gave out $5.8 billion in fraudulent refunds to identity thieves. This latest breach only hurts the agency’s already damaged reputation.

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