YOUR MONEY ID theft spikes at tax time
Nalini Persaud’s tax refund was supposed to be her salavation this year. Persaud, 30, a single mother from Hollis, Queens, said the $5,000 check she expected to receive from the IRS on wages she’d earned from her recently-closed housecleaning business is urgently needed as she struggles to support herself and her nine-year-old daughter on part-time babysitting jobs.
Persaud even filed her tax return in January so she would get her refund early — only to discover that someone in Brooklyn had somehow obtained her Social Security number and received her check by filing a fraudulent tax return using Persaud’s personal information.
“It's been a nightmare and I wouldn’t wish this on my worst enemy,” said Persaud, who has no idea how it happened or when the matter will be resolved.
“I have no savings and no fulltime job prospects, so I was counting on this refund to help me get back on my feet and restart my business, but now that's impossible.”
With the April 15 deadline for filing tax returns looming, incidents of tax fraud are on the rise again across the U.S. as thieves file fake returns using real Social Security numbers, then keep the refunds.
The Internal Revenue Service flagged an estimated 262,000 suspicious returns in 2011 seeking nearly $1.5 billion in refunds — an increase of more than 80% from the year before.
The Federal Trade Commission currently lists ID theft as its No. 1 consumer complaint for the twelfth consecutive year, with about 15% of complaints tax-related.
The money involved can be staggering. Federal authorities recently uncovered a massive scheme in which the perpetrators reportedly received about $2 billion in refund checks using the stolen identities of Puerto Rican citizens.
Though no one is immune, among the most common targets in New York City are people who live in immigrant communities where a recent flood of unqualified storefront tax preparers have been cropping up, said New York City Department of Consumer Affairs Commissioner Jonathan Mintz.
Even if the preparer is legitimate, clever ID thieves will find a way to get their hands on the treasure trove of personal information found on a return.
“The harsh reality is that even with our best efforts to curtail these shady operations, nothing is foolproof.
“And no tax preparer is completely immune to criminal activity regardless of how good his oversight is,” added Mintz.
“The problem is that as well as you think you might be protecting yourself, you are only as safe as the places that have your information,” said Steven Weisman, an identity theft attorney and author of “The Truth About Avoiding Scams.”
To avoid potential problems, Mintz advises New Yorkers either check out their preparer’s credentials with professional organizations like the American Institute of Certified Public Accountants (aicpa.org), or call the 311 hotline to inquire about any complaints.
“As much as technology makes our lives simpler, it also makes the lives of identity thieves easier, too,” Mintz said.
Aboubacar Donzo, a 49-yearold livery cab driver from Far Rockaway, Queens, knows firsthand just how easy — he’s had his identity stolen three times since 2006, most recently in January. And he still doesn’t know how it happened.
“I work hard, play by the rules and this is what happens,” said Donzo. “I feel like I’ve been betrayed by the entire system.”