For the IRS, this is a feature:
According to Koskinen, identity thieves took advantage of a bug in one of its web-based data tools that allowed it to file false tax returns that could have potentially cost the federal government millions had it not been caught.What about the crooks running the IRS itself?
From the Washington Times:
The agency’s “data retrieval tool” is designed to import financial records between the IRS and the Department of Education’s website to help taxpayers completing a lengthy college financial aid form know as the Free Application for Federal Student Aid, or FAFSA. According to the commissioner, however, criminals harnessed a security flaw within the tool to steal other people’s data and then file and collect false tax returns.
Koskinen says the IRS had disabled the tool last month, but not before issuing 8,000 fake tax returns, costing $30 million. 14,000 others were spotted by investigators before the refunds went out, and 52,000 were stopped before anything could happen at all.
Despite Koskinen stating that they were able to stop the problem before it got too out of hand, he reveals that the agency had known about the problem since October.
“To shut it down without a clear indication of criminals actually using it seemed to us that it was going to unnecessarily disadvantage millions of people who used it,” he told the committee.