IRS Exposes Millions To Increased Fraud And ID Theft


The IRS failed to do background checks on some private contractors who handled confidential taxpayer information, exposing 1.4 million taxpayers to an increased risk of fraud and identity theft, a government investigator said Thursday.

In one case, the IRS gave a printing contractor a computer disk with names, addresses and Social Security numbers of 1.4 million taxpayers, but didn’t require a background check for anyone who worked on the job.

IRS policy requires contractors with access to confidential taxpayer information to undergo background checks, though the policy wasn’t always followed. About 10,000 private contractors have access to such information.

The report did not examine whether any of the private contractors misused taxpayer information, but in recent years the IRS has reported a big jump in thieves trying to fraudulently claim tax refunds using stolen Social Security numbers.

ABC’s Aaron Katersky joined us with details.

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