Woman Accused of Filing 3,000 False Tax Returns in $7.5 Million Scheme

An Alabama woman was arrested May 12 for allegedly filing more than 3,000 false tax returns and defrauding the government of millions of dollars in the process, according to a news release from the Department of Justice. The accused, Talashia Hinton, allegedly worked with others who gave her IRS electronic filing identification numbers (EFINs) and stolen personal information so she could prepare the fraudulent returns.

Hinton was charged with one count of conspiracy to defraud the United States, five counts of wire fraud and five counts of aggravated identity theft, according to the DOJ news release. She is said to have received more than $7.5 million in refunds from the fraudulent returns filed in the 2012 and 2013 tax seasons.

The Internal Revenue Service pays out hundreds of billions of dollars in refunds every year, but a $7.5 million scheme in two years is still noteworthy. It’s not clear from the DOJ information how many people were involved in the alleged fraud operation, but Hinton is accused of securing the money. She allegedly directed the IRS to issue refunds by check and through direct deposit on prepaid debit cards.

Schemes like this have ensnared millions of Americans in the past several years, delaying the refunds they’re entitled to by months or years and often complicating their tax-filing seasons for years to come. Usually, victims of tax identity theft do not discover they’ve become a victim until they try to file their legitimate returns, only to be told a return has already been filed for their Social Security numbers. For people who rely on tax refunds to make necessary purchases or pay down debt, the ensuing delay in refund can be extremely problematic.

You may not want to think about tax season for another several months, but if you want to reduce your chances of becoming a victim of tax identity theft, prepare now to file your 2015 taxes as soon as possible next year. The earlier you file, the smaller chance there is a thief will file a fraudulent return in your name before you do.

Keep in mind this is a difficult crime to prevent. If you’ve ever had your Social Security number compromised, you’re at great risk for experiencing this crime, and even if you don’t think any major personal information of yours has been exposed, it’s still important to monitor your identity and accounts for signs of fraud. Not only is it a headache to deal with identity theft and a delayed tax refund, related issues like a shortage of cash flow or other fraud could damage your credit standing. You can get free annual credit reports under federal law at AnnualCreditReport.com and you can monitor your credit scores for for free every month on Credit.com.