Employees at the Internal Revenue Service were pressured by their supervisors to ignore potential fraud in a program designed to give taxpayers identification numbers, according to an investigation by an internal Treasury Department watchdog.
The Individual Taxpayer Identification Numbers program was designed to provide ID numbers to people ineligible for Social Security Numbers. The IRS processed more than 2.9 million tax returns from members of the program in 2011, the report said.
But supervisors created "an environment which discourages employees from detecting fraudulent applications," wrote J. Russell George, the Treasury Inspector General for Tax Administration.
Employees were told instead to focus on turning out a high volume of completed applications, not worrying about whether they were fraudulent or not, the report said, adding that successful evaluations and processes used to identify fraudulent claims were gutted.
“To their credit, the IRS recently announced a series of improvements that will take effect immediately on an interim basis, in response to our findings," concluded George. "It is to be hoped that significant, systematic change, rather than interim improvements, will take place.”