Arizona's Tax Department Catches $74 Million in Phony Refunds
The Arizona Department of Revenue prevented about $74 million in fraudulent tax refunds from being sent out, according to agency officials.
Five years ago, the agency reported stopping less than $2 million in payouts of phony tax refunds.
The fraudulent returns are the result of someone using either a stolen or fictitious identity to file tax returns.
A statement from the department credits better enforcement and investigations for the huge increase in false refunds caught by the department:
Anthony Forschino, Assistant Director for the Department of Revenue in charge of criminal investigations . . . attributed the increase from the prior year to enhancements to the Department's computer programs along with assigning additional highly trained and motivated financial auditors and investigators to this effort. Forschino also said, "The Department is working with the IRS, other states and law enforcement agencies to share information and develop strategies to combat this kind of fraud, especially by the larger criminal syndicates and organized groups who are engaged in this type of fraud."
There's no doubt that $74 million is a ton of money, but consider that the Department of Revenue reported collecting more than $13 billion in total taxes in 2013, $7.1 billion of which went straight to the state's general fund.
At the federal level, the Internal Revenue Service reported catching $20 billion in fraudulent refunds in 2012.
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