Few, if any, companies or government agencies store more sensitive personal information than the IRS, and consumers have virtually no insight into how that data is used and secured. But, as the results of a recent Justice Department investigation show, when you start poking around in those dark corners, you sometimes find very ugly things.
Beginning in 2008, a small group of people–including an IRS employee who worked in the Taxpayer Advocate Service section–worked a simple and effective scam that involved fake tax returns, phony refunds, dozens of pre-loaded debit cards, and a web of lies. The scheme relied upon one key ingredient for its success: access to taxpayers’ personal information. And it brought the alleged perpetrators more than $1 million.
The scam’s particulars are not unique. There have been a variety of similar operations that have come to light over the last few years, with IRS employees improperly accessing taxpayer records as part of a financial fraud or out of curiosity over what an athlete or actor makes. What sets this case apart is that the accused IRS employee, Nakeisha Hall, was tasked specifically with helping people who had been affected by some kind of tax-related identity theft or fraud.
From that position, Hall allegedly tapped in to the personal files of an untold number of taxpayers and used the data she found there to file false tax returns in those victims’ names. The returns would be set up in such a way that the “taxpayers” would be due refunds. Hall typically would request that refunds be put on debit cards issued by Bancorp Bank or another bank, according to an indictment issued by the Department of Justice in December. The debit cards would be mailed to addresses that Hall had access to, and then Hall’s alleged co-conspirators Jimmie Goodman and Abdullah Coleman would pick up the cards.