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Inspector General Slams IRS For Turning Blind Eye To Victims Of Illegal Immigrant Identity Theft

September 5, 2013

As you know, the IRS has been called out by the Treasury Inspector General (IG) for allowing billions in fraudulent returns to be diverted to illegal immigrants. Now the Social Security Administration IG is slamming the IRS for allowing companies and illegal immigrants to use stolen and fraudulent Social Security Numbers for employment. The full audit report is available here (PDF) – please read it (it’s short).

This type of W-2 mismatching has been going on for decades and the large proportion engaging is this are illegal immigrants (and the businesses who hire them):

…a senior employment tax official at the IRS acknowledged that unauthorized noncitizens accounted for a high percentage of inaccurate wage reporting.

Furthermore, this is anything but a victimless crime. Unfortunately, many of those victims are children:

But, the audit determined, no-match W-2s were more likely to be filed using a real Social Security Number that belonged to someone other than the person on whose behalf the W-2 was filed. “SSA had assigned the remaining 2 million (80 percent[*]) SSNs to someone else,” said the report. “About 380,000 of these belonged to young children, and about 258,000 belonged to deceased individuals.”

The IG reminds the agency that “…intentional misuse of a Social Security Number is a felony…” and castigates them for looking the other way. The IG has an uphill battle, however. I think the IRS is essentially taking a cue from political elites, business elites, and amnesty groups. All consistently ignore the massive identity theft problem accompanying illegal immigration and fight against measures like E-Verify which would almost eliminate child identity theft. To wit, the Gang of Eight illegal immigration amnesty bill provides explicit amnesty from this felony (for individuals and businesses), levies a $10,000 fine against any processing employee reporting the breach to the victim, and undermines E-Verify implementation.

Count on this report being ignored by the media and their favored allies.

*Note: The remaining 20% were not assigned numbers. These will eventually be assigned which leads to babies being “born into identity theft” or legal immigrants etc being assigned a corrupted identity.

UPDATE: Be aware that the report analyzed a subset of filings (only 200 companies) which indicates that actual numbers of victims are orders of magnitude higher than what is in the report.  The numbers related to children are only for 0-13 years of age.  This means the 1.35 million SSN mismatches (from 200 companies over 3 years) includes children 14-17. The SSA IG directly confronts the driver of the mismatches (ID theft):

In previous reports, SSA acknowledged unauthorized noncitizens intentional misuse of SSNs has been a major contribute to the ESF’s growth.

As does the IRS:

Furthermore, a senior employment tax official at the IRS acknowledged that unauthorized noncitizens accounted for a high percentage of inaccurate wage reporting.

Finally, the SSA IG exposes the unethical businesses and their IRS enablers [emphasis added]:

SSA staff told us employers hired unauthorized workers because nothing prevented them from doing so.  That is, employers know SSA had no legal authority to levy fines and penalties, and they were not concerned about potential IRS sanctions.  Several of the industry associations we contacted acknowledged that unauthorized noncitizens contributed to SSN misuse.

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