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Tag Archive for Fraud

IRS Recommends Steps To Minimize Effect Of Data Theft

Every day, the theft of personal and financial information puts people at risk of identity theft. Generally, thieves try to use the stolen data as quickly as possible to:

  • Sell the information to other criminals.
  • Withdraw money from a bank account.
  • Make credit card purchases.
  • File a fraudulent tax return for a refund using victims’ names.

Victims of a data loss should follow these steps to minimize the effect of the theft: Read more

Security Summit Partners Warn Tax Pros Of Heightened Fraud Activity As Filing Season Approaches

WASHINGTON – The Internal Revenue Service, state tax agencies and the tax industry today warned tax professionals of early signs that cybercriminals already are at work as the nation’s tax season approaches. Fraudsters are using a new round of emails posing as potential clients or even the IRS to trick tax practitioners into disclosing sensitive information.

The Security Summit partners encourage tax practitioners to be wary of communicating solely by email with potential or even existing clients, especially if unusual requests are made. Data breach thefts have given thieves millions of identity data points including names, addresses, Social Security numbers and email addresses. If in doubt, tax practitioners should call to confirm a client’s identity.  Read more

Avoid Ponzi Schemes With This Professional Inside Scoop

There are several investments that turn out to be fraudulent schemes in which investors invest their hard earned funds and lose those funds because there was never in fact an actual investment that produced profits. Generally, those frauds are known as Ponzi Schemes.

Taxpayers who lose money in Ponzi Schemes may enjoy a tax advantage and recoup some of their lost funds by deducting their losses as financial theft losses. Deductions may be used against income that is being earned by the defrauded taxpayer, both before and after the fraud is discovered. There are several important rules that must be followed to enjoy this tax benefit.

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Holiday Fraud Awareness Reminders

Fraud Alert: this reminder comes at a timely moment as we head into the busy and hopefully joyous holiday season. With all the distractions of the season, it’s easy to forget about the devious schemes some people on this planet use to con others out of their hard earned cash.

Complete strangers commit the most common cases of fraud via the telephone and Internet. However, it’s not uncommon to hear about other crimes committed by trusted employees, financial advisers, tax preparation officials and even family members. You simply must be alert and learn how to recognize when a con is happening. Read more

What US Expats Can Learn From the Paul Manafort Indictment

President Trump’s former campaign manager Paul Manafort, along with his associate Richard Gates, were indicted last week, with a long list of criminal charges filed against them.

The charges include engaging in conspiracies against the United States and to launder money, making false statements, acting as an unregistered foreign agent, and failing to report foreign bank and financial accounts.

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What Can We Learn From Paul Manafort’s Tax Problems?

What will the IRS do with Paul Manafort if the special prosecutor’s allegations are true? On October 30, 2017, the special prosecutor released an indictment against Paul Manafort, former campaign manager for President Trump, related to his actions as an unregistered agent of the Ukraine government. The prosecutors allege that Manafort had opened 16 foreign companies and conspired to money launder over $18 million of payment through these companies.

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Canadian Tax Help – Protecting Your Company: Key Reports

Grant Gilmour, Canada, CPA

What reports should you be reviewing regularly to identify irregularities?

Whether you work in the company daily or manage from afar, there are key reports you should be reviewing regularly to stay informed and detect possible fraud.

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Protecting Your Company: Bank Reconciliations

Grant Gilmour

How does preparing bank reconciliations help to detect and prevent possible fraud?

A bank reconciliation explains the difference between the balance in the bank account per the accounting records and the balance actually in the bank at any given time. The bank reconciliation should be prepared and reviewed monthly to analyze the differences and help detect errors or fraud. This internal control will also help deter fraud.

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First Loss for IRS Involving Swiss Bank Accounts!

TaxConnections Picture - Success Compass“Happiness.” That is what retired auto dealer Jimmy Pflueger told reporters he felt as he left the U.S.District Courthouse today, just after U.S. District Judge Leslie Kobayashi found him “not guilty” on four federal tax fraud charges.

The 87-year-old retired automobile dealer – who founded the Pflueger dealerships – had been charged with filing false tax returns after the U.S. Justice Department said he hid nearly $15 million in a Swiss bank account without paying taxes on the $27.5 million sale of the Hacienda Corporate Plaza in California. The government also initially charged Pflueger with the failure to file a Report of Foreign Bank and Financial Accounts (FBAR), but dropped that charge before trial.

Pflueger’s accountant, Dennis Duban, who has already pled guilty to a related tax fraud charge and to conspiracy of aiding in the filing of a false tax return, testified Pflueger sent his money overseas to protect his assets after he was sued over the breach of his Ka Loko Dam in 2006. The breach killed 7 people and an unborn child. According to the government, Duban and Pflueger engineered the Hacienda sale to effect offshore tax evasion by transferring the proceeds from the sale to a Swiss bank account in order to prevent the proceeds from being used to pay civil claims arising from the 2006 accident. However, Pflueger’s criminal tax attorneys were successful in arguing that Pflueger was not responsible for his IRS tax problems, and that Duban was the sole mastermind of the tax fraud. Read more

How Can Theft Prevention, Reporting and Return Filing Be Improved?

Changing the April 15 due date, moving taxpayer information to the cloud, and allowing personal identification numbers (PINs) for taxpayers who want them were all on the table at a Thursday hearing held by the IRS Oversight Board to explore ways to combat fraud and improve tax administration. The board, composed of presidential appointees with tax, technology, or business expertise, advises the IRS on the best ways to meet taxpayer needs.

Fraud and Identity theft

Fraud and identity theft are still rampant, according to Michael Phillips, acting principal deputy inspector general, Treasury Inspector General for Tax Administration (TIGTA), who cited billions of dollars fraudulently claimed on refundable credits such as the American Opportunity tax credit. He said “the IRS recently prevented $12.1 billion of potentially fraudulent refunds from being issued, but more work needs to be done”.

Fraud comes in many forms, observed James R. White, director of tax issues for the United States Government Accountability Office (GAO). Given its many sources, such as failure to file, underreporting, and off-shore tax evasion, Read more

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