Mongoose
7 hours ago
Really, Mr. Wyden? Refund delayed? Let me tell you a story. I was working financial intelligence and got a call from a local bank. Seems they had a guy who wanted to deposit a million dollar+ check from the IRS. His tax refund, he said. The bank, which is supposed to report sketchy-looking activity on Treasury Suspicious Activity Report forms, thought this was... suspicious. On account of this guy had a W-2 job that paid him about $50,000/year. The bank really, really, really did NOT want to do this transaction, which they were certain was fraudulent.
It sounded squirrelly to me, so I called the IRS-CID special agent who handled refund frauds and was surprised to hear he already knew about it. The guy was pulling a 1099 OID fraud (it's on Wikipedia), and the bank had already told the IRS about it. I said, "Well, good, you can stop payment on the check, nip this fraud in the bud."
Nope, they'd been instructed not to interfere with the deposits/cashing of any refund checks. Go ahead and do the transaction, they told the bank. If it's fraudulent, we'll try to get the money back later. They couldn't even delay the check for a couple of weeks to do an investigation. Why? Because of Ron Wyden and people (Senators and Congressmen) like him. Apparently taxpayers(?) had been complaining to their congress folks about not getting their refunds (especially the fraudulent ones) in a timely fashion, and Ron and his buddies don't like those kinds of calls and can earn some easy constituent gratitude by squeezing IRS to push out that check post haste, so that's what IRS did.
I told the S/A that I thought he and IRS were f'n morons and told him I was going to tell the bank that I believed their deposit of the check would be a potential money laundering violation (thereby guaranteeing they wouldn't touch it or that customer with a hazmat suit). Which I did. (And in fairness, the refund fraud S/A was as distressed about it as I was.)
The crook took his business elsewhere, deposited his check, moved all the money out and when IRS finally went to get it, it was gone.
Now, multiply that little piece of insanity by a couple hundred thousand taxpayers(?) and we're starting to talk real money. Wikipedia says one 1099 OID fraud case involved three quarters of a billion dollars in false claims.
But those checks all went out because Ron Wyden doesn't want your refund delayed.