Raymond Sylvia knew something wasn’t right when he received a notice from the Massachusetts Department of Revenue (DOR) in February telling him his 2013 taxes were being investigated and that he would be audited.
“I called the number in the letter and asked them how I could be audited when I hadn’t filed my taxes yet for 2013,” the 58-year-old Oak Bluffs builder told The Times. “I was asked a few personal questions and she said, ‘obviously you are who you are. We’ve got to find out what’s going on here.’”
Three weeks later, he received a call from the DOR. The DOR had determined the claim in question was fraudulent.
“Someone lifted my name and social security number and used them to file a return in my name,” he said. The fraudulent claimant had requested a refund of $4,000.
“That’s more than twice as much as I have ever paid in state taxes,” Mr. Sylvia said. “It is rare for me to get anything back from the state.”
The identity thief also used his information to file a fraudulent federal return and request a large refund from the Internal Revenue Service. He received a letter from the IRS as well.
In both cases, the tax collecting authorities issued him personal identification numbers (PINs) and instructed him to file his taxes on paper forms rather than online.
Mr. Sylvia took quick action to try to reduce the chance that his personal information would be used again. Within hours of discovering the identity theft Mr. Sylvia signed up for credit protection from an online company called Lifelock, a protection service that automates the process of alerting customers and businesses of potential unauthorized access using changes in credit reports. He signed his wife up for the service as well to protect her even though there was no evidence that her identity had been stolen. He pays a total of $500 a year for the level of protection he chose.
Mr. Sylvia said the Lifelock protection thwarted the identity thieves’ attempts to use his information to set up credit card accounts, a bank account and even borrow money on a student loan. A few days before receiving the IRS letter Mr. Sylvia had a call from the online bank and financial services company, USAA.com, asking about his over-extended checking account. The bank had assumed the account was fraudulent after contacting Lifelock.
“I don’t have an account with USAA,” he said. “They asked me if I lived in Las Vegas. I said no. They said, ‘then it’s definitely not you.’ Again the thieves used my social security number and had enough information to open an account. USAA got my phone number from Lifelock.”
Two credit card companies, suspicious that account applications in Mr. Sylvia’s name might not be valid, called him to see if he really wanted new credit cards, which he didn’t. And an attempt to take out a student loan using his information was stopped when he received a call from the lender.
“Lifelock has been very, very good,” he said.
Mr. Sylvia said an article he read on the hacking of Experian, an online credit bureau, lead him to believe that his social security number may have been picked up there, but he is not sure. He occasionally does some shopping online but has had no other online financial transactions that have given him reason to be concerned.
Danielle Clermont, 23, of Vineyard Haven told The Times she received an error message that prevented her from filing her federal taxes online when she tried to file in early March. She went to the Hyannis IRS office to resolve her problem. “After a three-hour wait I met with a representative who looked at my return, looked at me and said, ‘I assume you don’t have three children.’”
Someone had filed a bogus return using her identity with a Florida address. Ms. Clermont has two Island friends who had similar experiences, also involving Florida addresses and she thinks their information may have been stolen when the three friends spent a winter working in Florida.
Ms. Clermont said she is putting her criminal justice education to work investigating the theft on her own and has narrowed her search to a retail store in Florida where all three friends shopped as the possible source of the stolen information.
Spring is tax season and paying closer attention to tax returns this year may be in order. Information thieves are filing fictitious tax returns in higher numbers than ever, according to a recent report in the Boston Globe. A recent audit by the Treasury Department’s inspector general revealed that 1.6 million taxpayers were affected by identity theft in the first six months of 2013, compared with 271,000 for all of 2010, according to the Globe.
A Congressional Research Service report says that about 12.6 million Americans were reportedly victims of identity fraud in 2012, and the average identity fraud victim incurred a mean of $365 in costs as a result of the fraud.
Identity theft is often committed to facilitate other crimes such as credit card fraud, document fraud, or employment fraud, according to the report. The IRS recommends reporting any fraudulent activity to the local police department and using the report to verify the identity theft with creditors, banks and any company that might require the report to verify the theft.
Tisbury police lieutenant Eric Meisner said that he is aware of only one report of identity theft to his office, and he encourages those who suspect their identities are being used for criminal purposes to a file a report. “Sometimes a police report can help during the investigative process by an agency like the IRS,” he said. “We don’t investigate Internet fraud ourselves.”
Mr. Meisner recommends consulting the department’s website at www.tisburypolice.org for advice on how to prevent identity theft. He said that the best way to prevent identity theft is to be cautious with requests for personal information from unknown, and potentially unreliable sources.
The IRS website has extensive information on preventing identity theft and what to do if a person’s identity is compromised. The Taxpayer Advocate Service (TAS) is an independent organization within the IRS that assists taxpayers who are experiencing economic harm or who need help with tax problems not resolved through normal channels. Their number is 877-777-4778.
The Commonwealth of Massachusetts website www.mass.gov also has extensive information on preventing and dealing with the effects of identity theft.