IRS Criminal Investigation targets tax fraudsters, urges taxpayers to protect themselves this tax season

WASHINGTON – IRS Criminal Investigation (CI) dedicates 70% of its time and resources to investigating tax crimes that include questionable refund schemes, return preparer fraud, abusive tax schemes, and more. This tax season, CI is cracking down on schemes that victimize U.S. taxpayers.

“Tax crimes surge during filing season because criminals steal unknowing taxpayers’ information, hack into the servers of CPA firms and tax preparation services and victimize unsuspecting taxpayers with the false promise of huge tax refunds,” said CI Chief Jim Lee.

In fiscal year 2023 alone, CI initiated 1,409 tax crime investigations and identified $5.5 billion in tax fraud. Six hundred fifty-five defendants were sentenced for tax crimes during the last fiscal year. Recent cases include:

Thein Maung and his daughter Phyo Mi ran an elaborate tax preparation scheme from their Iowa home that involved layers of subterfuge. They victimized hundreds of immigrants and refugees who worked at meat-packing facilities in Iowa by claiming fraudulent tax credits and redirecting their customers’ tax refunds to their own accounts. The scheme came to an end following an investigation by CI. In October, Maung and Mi were sentenced to 12 and nine years in federal prison for fraud and related tax charges.

Ayodele Arasokun was sentenced to 34 years in federal prison in September 2023 for orchestrating an international tax scheme that involved wire fraud and aggravated identity theft. Arakosun coordinated a scheme to file 1,701 false tax returns and claim $9.1 million in refunds, which ultimately resulted in $2.2 million in refunds issued by the Internal Revenue Service. He then transferred the money to prepaid debit cards and checking accounts that he monitored. The investigation revealed that Arakosun was tracking more than 700 U.S.-based accounts containing more than $50 million.

CI urges U.S. taxpayers to be vigilant this tax season:

• Avoid return preparers who claim they can obtain larger refunds than other preparers or whose fee is a percentage of your tax refund.
• Use a reputable tax professional who signs and enters a preparer tax identification number (PTIN) on your tax return and provides you with a copy of the return for your records.
• Never sign a blank tax form and ensure your refund goes to your account, not your tax preparer’s.

• Protect your personal and financial information. Don’t click links or open attachments in unsolicited emails or text messages about your tax return or those claiming to be from the IRS. These messages are fraudulent and could contain malware that could compromise your personal information.

• Report fraud to law enforcement. Submit Form 3949-A, Information Referral, PDF if you suspect an individual or a business is committing fraud.

The 2024 Tax Filing Season begins Jan. 29, and the deadline to file, pay any tax owed or request an extension to file for most of the nation is April 15. The deadline for taxpayers in Maine and Massachusetts is April 17.

CI is the law enforcement arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a nearly 90% federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.