Read More »"/> Read More »"/> IRS Fails in Tax Fraud Fight | MyGovCost | Government Cost Calculator

IRS Fails in Tax Fraud Fight

Monday July 29th, 2013   •   Posted by K. Lloyd Billingsley at 9:41am PDT   •  


Photo: Don Carrington/Carolina Journal

Photo: Don Carrington/Carolina Journal

As recent congressional hearings confirmed, the Internal Revenue Service can be very efficient when it comes to voter suppression. But when it tries to fight tax fraud the IRS is something of a bust, as the story of Carol Cooke confirms.

Cooke has lived at her Long Island home for 37 years. In 2011, she began receiving fraudulent tax funds, for thousands of dollars, all to people who did not live at her residence. She contacted the United States Postal Service, which proved of no help whatsoever, so she turned to the IRS, which told her to write “return to sender” on the envelopes. Unsatisfied, Cooke turned to the New York State Attorney General’s office, complete with copies of the checks. The AG told her to contact the IRS. Determined to halt what she perceived as massive fraud, she found an “IRS Fraud Reward Whistleblower” form and copied her correspondence to her congressman, Tim Bishop.

The IRS told Cooke she did not qualify for any reward under the whistleblower program. All she wanted was to stop the fraud, and, despite some arrests on Long Island, it remains unclear whether the IRS has taken any action against those using Cooke’s address. It did emerge, however, that the scammers were bribing postal workers, who are federal employees. The Postal Inspection Service in New York did not find and punish those involved but said “by and large, postal employees are honest people. There can be some bad apples in any group.”

Cooke also took her story to the media and found them uninterested, except for Carolina Journal, which had previously published stories on tax fraud. In their story on Cooke, the Journal noted that Stolen Identity Refund Fraud (SIRF) costs U.S. taxpayers more than $5 billion a year. The IRS is obviously an easy target for such fraud, even in cases when they have an honest, motivated whistleblower such as Carol Cooke as an ally. Instead federal and state agencies prefer to “pass the buck,” as the Journal noted.

Perhaps it is all part of the “horrible customer service,” that IRS bosses have acknowledged, but consider another possibility. Corrupt IRS employees could have been involved in the scams, just as corrupt postal workers were. When they have finished with IRS voter suppression, the Committee on Oversight and Government Reform should look into it.

Facebook Twitter Youtube

Support the Independent Institute when you shop on Amazon with the AmazonSmile program. Every time you make a purchase, 0.5% will be donated to Independent on your behalf, at no extra cost to you. Just visit, log in using your usual Amazon account details, and select the Independent Institute as your charity.

RSS Recent Posts on The Independent Institute’s Other Blog, The Beacon


July 2013