Tax Scammers Inside the Slammer

Jail 150x150 Tax Scammers Inside the Slammer

Photo credit: Copyright Corbis

As if there aren’t enough IRS scams out there, I just read an article that said prison inmates file bogus tax returns and pocket refunds!  Not only is it happening often, it’s a growing problem. There has been a 1,214 percent increase (that’s not a typo) in fraudulent inmate tax returns from 2005 to 2012.

Denver’s 9NEWS reports that the IRS catches 94 percent of fake returns but the number of refunds issued still adds up. 9NEWS interviewed the Treasury Department’s Inspector General for Tax Administration, J. Russell George, who said hundreds of millions of dollars are reaching the scammers and prisons need to do more to prevent the problem.

That’s what amazes me is that prisoners can get away with something like this. White collar crimes are a serious economic problem for our country. I know inmates get away with other scams too such as debt collection schemes. The BBB has heard reports of people who are called by someone saying they are a bill collector and demand immediate payment of a debt via wire transfer or other means. When the victim traces the call, it turns out to be from a correctional facility!

So why aren’t calls being monitored to prevent collection scams are why isn’t mail being inspected to prevent the tax return scams? Maybe it’s more complicated but it seems that better monitoring can stop some of these crimes that go on inside our prisons.

What do you think? Have you ever been scammed by someone who was in jail? What do you think should be done about the problems? Why do you think inmates get away with crimes?

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About Megan Herrera

Megan Herrera is the Denver/Boulder BBB's public relations specialist. She has been with the BBB since 2004.