Report: IRS has more work on fraud prevention system

The IRS’s current defense against fraud, the Electronic Fraud Detection System, is close to two decades old, and the agency has said it doesn’t make sense to keep it beyond 2015.

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In all, the agency says that some $19.2 billion worth of tax return fraud occurs each year. The Return Review Program, if implemented correctly, would give the IRS a better shot at flagging and preventing fraudulent returns from being issued.

“Fraud detection systems are of critical importance in the fight against tax fraud,” Russell George, the tax administration inspector general, said in a statement. “If deployed correctly, the Return Review Program could significantly enhance the IRS’s capabilities to prevent, detect, and resolve tax refund fraud, including identity theft.”