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From fraud-ridden Florida, Sen. Bill Nelson targets tax ID theft


IRSWith nine of the United State's top 10 tax-ID fraud cities in Florida, Sen. Bill Nelson is again backing legislation to crackdown on the $5.2 billion crime.

The cities:

1 Miami-Fort Lauderdale-Pompano Beach, FL Metropolitan Statistical Area 35,914 645.4

2 Naples-Marco Island, FL Metropolitan Statistical Area 1,279 397.8

3 Tampa-St. Petersburg-Clearwater, FL Metropolitan Statistical Area 9,805 352.3

4 Cape Coral-Fort Myers, FL Metropolitan Statistical Area 1,810 292.5

5 Tallahassee, FL Metropolitan Statistical Area 1,060 288.5

6 Lakeland-Winter Haven, FL Metropolitan Statistical Area 1,692 281.0

7 Port St. Lucie-Fort Pierce, FL Metropolitan Statistical Area 1,156 272.6

8 Atlanta-Sandy Springs-Marietta, GA Metropolitan Statistical Area 12,992 246.6

9 North Port-Bradenton-Sarasota, FL Metropolitan Statistical Area 1,720 244.9

10 Orlando-Kissimmee-Sanford, FL Metropolitan Statistical Area 4,991 233.8

Here's the press release:

WASHINGTON, D.C. - Two highly influential U.S. senators have joined today to cosponsor legislation by Florida’s Sen. Bill Nelson, increasing the chances for passage of Nelson’s measure targeting tax refund identity scams.  The Identify Theft and Tax Fraud Prevention Act of 2013 is being filed Tuesday morning.

Sen. Dianne Feinstein (D-CA) has signed on as chief cosponsor of the bill.  The California Democrat is a senior member of the Senate Judiciary Committee, which will need to approve several provisions.  Also cosponsoring is Sen. Charles Schumer (D-NY).  As a member of the Senate leadership team, the New York Democrat could help get the bill a vote on the floor.

“I am pleased to join Senator Nelson as a cosponsor of the Identify Theft and Tax Fraud Prevention Act. I have long believed that easy access to Social Security numbers is a significant source of identity theft, notably fraud related to tax refunds. This bill takes serious steps to address the problem, including a prohibition on display, sale and purchase of Social Security numbers without the individual’s consent and enhanced criminal penalties,” said Feinstein, who has long advocated for prohibiting the sale or purchase of Social Security numbers.

“Each year, more and more identity thieves are swiping returns right from underneath hard-working taxpayers. It’s time to put the brakes on this scam,” said U.S. Senator Charles E. Schumer. “This commonsense bill would crack down on a growing trend that costs taxpayers billions in lost refunds every single year. We need to punish these thieves with tougher penalties, and to make sure that taxpayers aren’t left without their return for months on end.”

“Florida is the nation’s hot spot for tax refund identity scams,” said Nelson, who will chair a hearing Wednesday looking at how the crime specifically affects the elderly.  “We can’t just sit back while taxpayers are being victimized.”

The legislation in question toughens criminal penalties for ID thieves who file fake refunds under someone else’s name.  It also requires the IRS to get legitimate taxpayers the refunds they’re due within 90 days.  Right now, it’s taking the IRS an average of 196 days to close identity theft cases.

A similar version of Nelson’s bill stalled in the Senate last year.  Yet, according to law enforcement, the crime of ID thieves stealing tax refunds is becoming epidemic – and, Florida is officially the nation’s hot spot.

Last May, for instance, an investigation by the U.S. Treasury Department’s inspector general – a probe requested by Nelson - found 1.5 million tax returns had been filed by identity thieves who claimed $5.2 billion in fraudulent tax refunds in the prior filing season.  According to the FTC, Florida leads the nation with 361 such complaints per every 100,000 residents.  Miami is worst in the state with 645 complaints per 100,000 residents.  Tampa and Orlando have 352 per 100,000 and 233 per 100,000, respectively.

Just last month, a 42-year-old Tampa auto dealer was sentenced to 15 years in prison for his role in a $9 million federal tax-fraud scheme that bought him a $60,000 Bentley coupe and diamond jewelry.  The dealer filed more than 600 fraudulent tax returns, according to The Tampa Bay Times and Tampa Tribune newspapers, which reported he attempted to rake in $8.9 million while the IRS approved $3.4 million in fraudulent returns. The dealer mainly chose elderly victims least likely to notice the fraudulent activity, authorities said.

The elderly are, in fact, among groups criminals appear to be targeting, according to the recent investigation by the Treasury’s inspector general.  That report also showed criminals are stealing the identities of low-income people who aren’t required to file returns, students aged 16 to 22, deceased individuals and the elderly.

Nelson, who chairs the U.S. Senate’s Special Committee on Aging, is holding a hearing April 10 to, among other things, explore ways the elderly can avoid becoming victims of this crime.  The hearing in room 526 of the Dirksen Senate Office Building begins at 2 p.m.