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UPDATE: Doctors nationwide victimized in ID theft fraud

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Many doctors and other health care professionals nationwide have been victimized this year by identity theft used to fraudulently obtain federal and state tax refunds — and their numbers are growing, medical industry and government officials say.

The American Medical Association says the exact number of doctors affected by tax fraud isn't known, but hundreds of cases have been confirmed in Connecticut, Indiana, Maine, New Hampshire and North Carolina.

Indiana's congressional delegation is calling for a full investigation of a spike in tax-related identity thefts involving the state's doctors.

The state's 11 members of Congress sent a letter Friday to the Internal Revenue Service urging a full probe of the 46 cases of identity theft Indiana's doctors and health professionals have reported this year.

The IRS is already investigating those cases. Indiana's total number of such cases peaked this year at a record 130, up from 54 reported last year.

She says it's unclear why so many physicians have fallen victim to identity theft, and there's no timeline for how long investigations will take.

The number of doctors, dentists and nurses targeted by identity theft scams has increased significantly this year, raising questions about a possible security breach of the personal information of medical workers, U.S. Sen. Richard Blumenthal said Thursday.

"It is incredible. The scope and size are appalling and astonishing. ... We're talking about hundreds (of doctors) nationally and tens of millions and maybe hundreds of millions of dollars," Blumenthal said.

Blumenthal and fellow Connecticut Democrat Sen. Christopher Murphy urged the IRS and Secret Service to dedicate their resources to solve these crimes and prosecute the perpetrators. Their pleas followed the rejection of many doctors' federal and state tax returns last month because they were filed by someone else. At the time, U.S. Sen. Jeanne Shaheen, a Democrat from New Hampshire, also called for an investigation.

Matthew Katz, chief executive with the Connecticut Medical Society, says that based on his conversations with his counterparts in other states, he'd put the number at a few thousand nationwide.

"Identify theft is a problem, but I have never heard of this level of fraud of any kind that is focused so predominantly on physicians," he said. "We are hearing about thousands of tax frauds against physicians. There has to be some connection."

Nearly 100 doctors in Connecticut have reported being victims of tax fraud this year, the Connecticut State Medical Society says. More than 150 doctors and health care providers in New Hampshire and Vermont and at least 35 Maine physicians reported being victims of tax fraud. More than 300 dentists in Michigan say they were tax fraud victims, the Detroit radio station WWJ-AM reported this week.

Both the IRS and the Secret Service said Thursday they are looking into identity fraud involving the medical profession, but IRS officials note that many Americans, not just doctors, fall prey to tax fraud.

"Identity theft is one of the fastest growing crimes nationwide, and refund fraud caused by identity theft is one of the biggest challenges facing the IRS," the agency said in a statement, adding that it has stopped 15 million suspicious tax returns and more than $50 billion in fraudulent refunds since 2011.

Attorney General Eric Holder also said recently that the "scale, scope and execution of these fraud schemes" has grown substantially. He said that in the past year, the Justice Department has brought charges against 880 people.

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  • Underlying problem is 'Income' Tax
    Far better to switch to the FairTax, so ALL tax revenue comes from the simple and established mechanism of retail sales-tax on new items. That eliminates all the fraud and political manipulation inherent in filling out 'tax returns', and yields predictable and reliable revenue streams, transparent to the taxpayer.
  • eat that cake too
    I can think of 9 members of this state's delegation signing that letter who should also stand and take a bow for their support for funding cuts and other anti-IRS antics. They're the same hypocrits who cut funds for security for State Department overseas facilities and will never stop trying to fabricate a scandal blaming the President for Bengazi. Live by the Tea Party, die by the Tea Party.

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  1. The east side does have potential...and I have always thought Washington Scare should become an outlet mall. Anyone remember how popular Eastgate was? Well, Indy has no outlet malls, we have to go to Edinburgh for the deep discounts and I don't understand why. Jim is right. We need a few good eastsiders interested in actually making some noise and trying to change the commerce, culture and stereotypes of the East side. Irvington is very progressive and making great strides, why can't the far east side ride on their coat tails to make some changes?

  2. Boston.com has an article from 2010 where they talk about how Interactions moved to Massachusetts in the year prior. http://www.boston.com/business/technology/innoeco/2010/07/interactions_banks_63_million.html The article includes a link back to that Inside Indiana Business press release I linked to earlier, snarkily noting, "Guess this 2006 plan to create 200-plus new jobs in Indiana didn't exactly work out."

  3. I live on the east side and I have read all your comments. a local paper just did an article on Washington square mall with just as many comments and concerns. I am not sure if they are still around, but there was an east side coalition with good intentions to do good things on the east side. And there is a facebook post that called my eastside indy with many old members of the eastside who voice concerns about the east side of the city. We need to come together and not just complain and moan, but come up with actual concrete solutions, because what Dal said is very very true- the eastside could be a goldmine in the right hands. But if anyone is going damn, and change things, it is us eastside residents

  4. Please go back re-read your economics text book and the fine print on the February 2014 CBO report. A minimum wage increase has never resulted in a net job loss...

  5. The GOP at the Statehouse is more interested in PR to keep their majority, than using it to get anything good actually done. The State continues its downward spiral.

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