Stolen Identity Refund Fraud: Who, What and Why

Stolen Identity Refund Fraud (SIRF) is a category that falls under identity theft. It involves the theft of the “tax” identity of the victim. As the tax filing season descends upon us we need to be aware of the very real threats of having an identity stolen.

Victims of stolen identity refund fraud have had their lives ruined. The criminal steals the “tax” identity of an individual for the purpose of filing a tax return. The criminal will obtain information about the victim and use it to obtain his or her social security number. The thief will then submit a false tax return in the name of the victim claiming a tax return. Forbes report claims that “unfortunately, in many instances the refunds are issued.”

The victims are left to discover the fraud when they go to file their tax returns. The IRS refuses to send out a refund because a return was already filed under the name of the individual.  The burden of proof rests on the individual to prove that their identity was actually stolen and that they did not file a return in the first place. It can be a very lengthy process for an individual to get straightened out with the IRS and it can be an even lengthier amount of time for any resolution to happen.

Sadly, stolen identity refund fraud victims are the elderly and individuals who are not required to file tax returns. Criminals who steal this information often get away with it for a long time before being caught. Often the victim finds out when they apply for state or federal benefits and cannot receive them due to information found on the fraudulent returns.

The IRS and the Justice Department have begun cracking down on identity theft and have been active in fighting identity fraud. The IRS makes it clear that the agency is devoted to preventing identity fraud. The website has information on how to report suspected identity theft and the precautionary measures that people can so they don’t become a victim.

Consumer Reports Warns Email Theft Increases Identity Theft

Consumer Reports is warning to consumers that use of email addresses as a user ID increases your risk of identity theft.  The report cites the theft of millions of Yahoo users who had their email addresses stolen recently. Yahoo identified the attack on user email accounts and immediately acted to protect users by prompting holders to reset their passwords, according to a blog post by the corporation.

While there is no evidence that data was breached from Yahoo’s computer network, according to Bloomberg Businessweek, there is evidence that user names and passwords may have been taken from a third-party database. Consumer Reports warning is to users who often use their email address as their user ID because it can increase the chance of hackers getting into any other accounts you have associated with that email/user ID.

Identity thieves call the maneuver multipurposing. They steal personal data from one account and use it to break into other accounts. The theft of an email address can also lead to phishing scams, malicious software being placed on users’ computers, and malicious and fraudulent links being sent to everyone on a users contact list.

Once a criminal has access to email and passwords he can use it to break into a users bank accounts, online accounts, and use the information gathered to steal a users identity.

Consumer Reports gives an example, “Once the criminal has your e-mail address, he tries to sign into accounts at some large banks or major shopping sites, claiming he forgot his password. Some institutions will e-mail a “password reset” link or, worse, the password itself, to your address.”

Consumer Reports goes on to explain that once the password has been reset to the criminals password he will have full use of banking or shopping accounts that were broken into. The best way users can protect themselves is to consistently change their passwords and never use the same user ID as their email.