The Internal Revenue Service (IRS) reported on Tuesday that 100,000 people’s tax returns were fraudulently gained access to by a group of criminals.
The criminals allegedly bought the data on the open market, after other hackers had gained access to it.
The IRS stated that the data used to breach the security in order to fraudulently request tax returns, as well as other filings came in the form of social security numbers, birth dates, addresses, as well as other personal information.
All the information gathered by the hackers was directed at filing false tax returns. The scheme resulted in 50 million dollars sent out in refunds to criminals.
Surely, once detected, the IRS is now looking into the breach. The GetTranscript application that was mainly used by the hackers is currently shut down in order to prevent further breaches.
The IRS reported that the breaches discovered were the only successful ones from the 200,000 attempts of using stolen data from February to March. As of yet it remains unknown whether the criminals were working inland or outside the United States.
Since 2013 the IRS is reported to have returned tax in a total of 5.8 billion dollars for fraudulent requests. As online crime has turned increasingly developed and complex in recent years, it is only too late when the IRS discovers the breaches.
IRS officials commented that identity stealing and sham refunds are part of a larger conundrum of organized crime both in the United States and abroad. Keeping up with the criminals is an almost impossible task.
Although under fire for not sufficiently securing access, the IRS stated that basic questions for the authentication process are easily prone to attacks. From there, using readily-accessible data as birth dates or birth places or even social security numbers, it’s just one step to dismantling an entire security system.
The IRS case is part of a wider systemic problem. Security experts warn that following recent breaches alone at other federal institutions and companies, bulk packages of user personal data are sold on the open market for any hacker to use.
At the same time, it was reproached to the IRS that the security system in place is weak for the type of service they provide at federal level. A more advanced one, sheltering a multi-factor system would have proved harder to crack.
Not putting sufficient investment in tracking activity that normally is suspicious is yet another claim against the IRS.
In response, Mr. John Koskinen – commissioner of the IRS stated for the press that this year alone, the institution did stop three million tax returns that seemed suspicious. Yet, with the current budget of the IRS there is only so much one can do.
The budget of IRS suffered cuts of 18% since 2010. The cuts entailed a cut in personnel as well, which resulted in 13,000 IRS employees laid off. Out of these, 10,000 people being employed in the enforcement sector were restructured.
The IRS data breach that resulted in 50 million dollars in fraudulent tax refunds is currently under investigation.
Taxpayers who had their accounts tampered are receiving free credit monitoring. They also received a letter from the IRS detailing the situation.
Image Source: foxnews.com
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