In the four years since its inception, the Indiana Department of Revenue’s (DOR) Identity Theft and Fraud Prevention Program has stopped over $110 million in attempted identity theft and tax fraud. “One of the most prevalent and life-changing problems in the nation is identity theft,” said DOR Commissioner Adam Krupp. “DOR has made a commitment to all Hoosier taxpayers to not only catch ID theft and tax fraud, but to deter fraudsters from repeated attempts.”
Now entering its fifth tax season, the program has seen substantial decreases in fraudulent returns for each consecutive year. What was once $88 million in fraud attempts in 2014, is now less than $2 million through 2017. The decreases are a result of the program’s increased fraud prevention system making it more difficult for criminals to be successful and less fraudulent returns entering the system.
As more fraud is detected on the front-end, fraudulent refunds are prevented from entering the payment system. This results in no payment or processing of fake returns, saving vital taxpayers’ dollars. Less than 200 fake returns made it to processing in 2017; down 99 percent from 2014. “The success of our fraud protection program is unparalleled,” said Commissioner Krupp. “From our identity confirmation quiz to collaboration with other states, Indiana’s program is one of the best in the country.”
A continued decrease in fraud dollars is expected for 2018 through the use of DOR’s three-step authentication to detect tax fraud and the agency’s collaboration with other states to share fraud data patterns.