IRS Failed to ID Fraudsters in Business Scam, Watchdog Says

The IRS may have sent tens of millions in fraudulent refunds to scammers, most of it recovered, by those impersonating business filers since 2023, according to an agency watchdog.

IRS representatives failed to properly verify the identities of callers requesting a new address for their refunds, according to a report dated Aug. 12 from the Treasury Inspector General for Tax Administration. Scammers, after requesting address changes, were able to divert refunds associated with employers’ quarterly tax returns, the partially redacted watchdog report said.

• From an initial referral in October 2024, TIGTA said it found $93 million worth of fraudulent checks ...