In the first part of this post, we began discussing the role of the IRS Criminal Investigation division.
As we noted, the CI’s role includes some rather surprising features. It goes beyond investigating suspected tax crimes to include other types of financial crimes. Indeed, it also includes the financial aspects of counterterrorism.
In this part of the post, let’s take a look at some of the CI’s key investigative priorities and statistics that reflect how actively it is pursuing them.
On its website, the CI puts lists identity theft fraud as the very first item on its priority list. This is understandable, given how frequent that type of fraud has been in recent years.
Other priorities for the CI include:
• Fraud by tax return preparers
• Fraud involving questionable refunds
• Offshore account disclosure
• Asset forfeiture
Overall, the CI initiated 5314 investigations in Fiscal Year 2013. This was up from 5125 investigations in FY 2012 and 4720 in 2011.
The increase is notable, for one thing, because the number of tax audits has actually been going down in recent years. We discussed that issue in our March 29 post.
But the CI division has not only been initiating more investigations. It has also been referring more cases for prosecution. The number of prosecution recommendations increased to 4364 in FY 2013, up from 3701 in FY 2012 and 3410 in FY 2011.
Given this referral pipeline, it stands to reason that convictions are up as well. And this is indeed the case, from 2634 in FY 2012 to 3311 in FY 2013.
Source: IRS.gov, “Internal Revenue Service Criminal Investigation, Annaul Business Report, Fiscal Year 2013,” Accessed April 9, 2014