Entries in House Oversight Committee (4)


Identity Thieves 'Make It Rain' Cash with Fraudulent Tax Refunds

Justin Sullivan/Getty Images(WASHINGTON) -- Police in Tampa, Fla. knew something was up when they noticed many of their biggest drug dealers were no longer on the streets. When one of the drug dealers was pulled over in a traffic stop, instead of finding drugs in the car police found large numbers of pre-paid debit cards and ledgers with social security numbers.

Identity theft involving tax fraud is increasing faster than law enforcement and government officials can deal with it, according to testimony Friday before a House Oversight subcommittee. Identity theft to scam fraudulent tax refunds from the government has increased 100 percent in just three years.

"As of August 31 of this year, IRS incident tracking reports indicated that the numbers of taxpayers affected by identity theft has more than doubled since 2008 to over 580,000 taxpayers this year alone,” said J. Russell George, Treasury Department Inspector General for Tax Administration.

The crime has become too easy. It’s like a party, according to Rep. Richard Nugent, R-Fla., whose district has a problem with tax related identity theft. “Tampa police department has busted what the lawbreakers call ‘Make it Rain’ parties, where criminals get together in a hotel room with internet access and file fake return after fake return,” Nugent told the committee.

Chances of getting caught and punished are low because each fraud case amounts to an average of $3,400, often too little to merit prosecution. To make putting the criminals behind bars even more difficult, the IRS is limited by law in sharing information from a taxpayers return with local law enforcement authorities.

Officials say once someone gets hold of a name, social security and date of birth, they have enough information to go on line, file a fraudulent tax return, and seek a tax credit.

"In 2010 IRS paid over $12 million to people who were listed as deceased,” said Rep. Todd Platts, R-Pa., the chairman of the subcommittee on Government Organization. “Service members who were killed in action defending this great nation are often targets of identity thieves who often use their information to steal tax returns from their families,” Platts added.

Making matters even worse, Platts said, “In 2010 IRS issued 4.2 billion in tax credits to individuals who were unauthorized to work in the United States.”

For the victims of tax fraud identity theft, the people who had fraudulent tax returns filed in their names, getting the problem fixed and their lawful refund paid could take a year-and-a-half. “A typical path for an identity theft refund case that is not complex may take as long as 18 months to resolve,” George told the subcommittee.

Democratic leader Rep. Edolphus Towns, of New York, felt it was too long to wait. “It is unacceptable to have innocent taxpayers waiting 12 to 18 months to verify their identity before a replacement refund check is issued,” he said. “We can and should do better.”

At the hearing, government officials vowed to do more to reduce identity theft tax fraud even though their budgets and staffs are likely to be cut to save money.

Copyright 2011 ABC News Radio


Ron Bloom Asked to 'Clarify' Recent Congressional Testimony

Ann Heisenfelt/Getty Images(WASHINGTON) -- The House Oversight and Government Reform Committee is asking former car czar and current White House Advisor Ron Bloom to “clarify” his recent testimony before the committee and whether he made a pro-union statement during the auto industry bailout in 2009.

“[The] Committee considers the veracity of witness testimony essential to conducting serious oversight of the federal government and how taxpayers’ dollars are spent,” the letter from Oversight Chairman Darrell Issa, R-Calif., and two fellow Republicans states.

Last month, Bloom, the current Assistant to the President for Manufacturing Policy, testified before the Committee on the General Motors bailout. During his time as a Senior Advisor on the President’s Task Force on the Automotive Industry, Bloom played a key role in the process that led to the reorganization of General Motors and Chrysler and worked closely with the companies, lenders and the union.

At the hearing, Indiana Republican Rep. Dan Burton asked Bloom if he said at a 2009 farewell party for the administration’s autos team that “I did this all for the union.”

Initially Bloom denied the comment, but later said he was misquoted:

Rep. Burton: Well did you say this at a dinner? There was a dinner and it was reported by David Shepardson, Washington correspondent for the Detroit News. At a farewell dinner of the Auto Task Force held in the restaurant Rosa Mexicano in late July 2009 that you allegedly said "I did this all for the unions.”

Mr. Bloom: No I did not say that.
Rep. Burton: You didn’t say that?
Mr. Bloom: No sir.
Rep. Burton: So, you were misquoted?
Mr. Bloom: That’s correct.
Rep. Burton: Well I’m going to call that guy up and ask him if you said that. You know that you are under oath here?
Mr. Bloom: I’m fully aware.
Rep. Burton: You made no comment like that at all?
Mr. Bloom: No sir.

The comment originally comes from a book written by Steven Rattner, Bloom’s former boss on the Auto Task Force. In Overhaul Rattner writes the following description of the dinner: “I thanked my colleagues for the enormous sacrifices that each had made. ‘In this deal, in this incarnation,’ I said, ‘you have epitomized what it means to serve your country.’ Fortunately, after I spoke, Ron Bloom was there to lighten the mood. ‘I did this all for the unions!’ he jokingly declared. Everyone laughed and the war stories began to fly.”

The quote was later republished in a story in The Detroit News.

"It appears that either a respected reporter and your former boss in the Obama Administration have both given inaccurate accounts of your comments to the public, or your testimony was not completely truthful," the lawmakers wrote in their Wednesday letter. "Therefore, if you would like to amend or clarify your testimony for the record, we encourage you to do so as soon as possible.”

According to the White House, however, the comment comes from just one source, Rattner, who clearly writes that Bloom made the comment as a joke.

Copyright 2011 ABC News Radio


Issa Subpoenas Bank of America over 'Sweetheart' Mortgages

Photo Courtesy - Bank of America(WASHINGTON) - Rep. Darrell Issa, R-Calif., Wednesday issued his first subpoena as chairman of the House Committee on Oversight and Government Reform to Bank of America in an effort to obtain all documents and records related to Countrywide’s VIP program.

The move is Issa’s latest effort to obtain names of current and former federal, state and local policymakers – including members of Congress – who potentially received sweetheart mortgage deals from the former Countrywide Financial Corp., which Bank of America obtained in 2008.

“Countrywide orchestrated a deliberate and calculated effort to use relationships with people in high places in order to manipulate public policy and further their bottom line to the detriment of the American taxpayers even at the expense of its own lending standards,” Issa said in a statement.  “This subpoena will allow us to obtain the information needed to answer the outstanding public interest questions regarding the full size and scope of the VIP program."

According to the committee, the subpoena compels Bank of America to produce certain documents by noon on March 7, 2011. Among those documents are all those related to covered borrowers serviced by Countrywide Financial through the Branch 850, VIP, or Friends of Angelo programs.

The term "covered borrowers" means that at the time of the loan, the borrower or their spouse were a current or former officer or employee of a federal agency, the U.S. Congress, a government-sponsored enterprise or of a state or local government.

Copyright 2011 ABC News Radio


Issa Prepares for First Oversight Hearing on Foreclosure Crisis 

Photo Courtesy - ABC News(WASHINGTON) – Darrell Issa has announced that the House Committee on Oversight and Government Reform will meet next Wednesday, his first meeting since taking over as chairman.

The hearing, “Bailouts and the Foreclosure Crisis:  Report of the Special Inspector General for the Troubled Asset Relief Program,” will focus on government oversight of the foreclosure crisis and the transparency of TARP.

“TARP was conceived by a Republican Administration, approved by a Democratic Congress, and has operated for two years under the current Administration,” Issa said. “It’s a fitting subject for bipartisan oversight in the new Congress.”

Invited to witness the hearing are Neil Barofsky, Special Investigator General of the Troubled Asset Relief Program, and Treasury Secretary Timothy Geithner.

Copyright 2011 ABC News Radio

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