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$30M Stolen Via Obama Homebuyer Credit

From CNN’s Money.Com:

Prisoners cashed in on homebuyer tax credit

By Aaron Smith, staff writer

June 23, 2010

NEW YORK (CNNMoney.com) — More than 1,200 prison inmates, including 241 serving life sentences, defrauded the government of $9.1 million in tax credits reserved for first-time homebuyers, according to a Treasury Department report released Wednesday.

Treasury’s inspector general also found that thousands of people filed multiple claims or made claims outside the allotted time period. In all, more than $28 million was improperly doled out.

The Internal Revenue Service program at issue is meant to stimulate the housing market by giving tax credits of as much as $8,000 to qualifying first-time home buyers.

"Additional controls are necessary to address erroneous claims for the credit," the report stated. "Further, fraudulent and questionable claims processed prior to implementation of controls will need follow-up action by the IRS."

According to the report, 4,608 state and federal inmates filed for these tax credits, and that fraudulent refunds were doled out to 1,295 of them.

The inspector general’s report said the most "egregious" fraudsters were 715 prison lifers, including 174 who filed with the help of paid preparers. From this group, 241 lifers were awarded $1.7 million.

The problem was particularly bad in Florida: 61% of the lifers who got credits were incarcerated in the Sunshine State

We posted about Florida inmates bilking tens of millions from the government by way of bogus tax refunds back in April. And, as that earlier report noted, that practice has gone on all across the country for many years.

So why should the IRS haven been surprised by this?

The report found that the IRS awarded $17.6 million to 2,555 filers who had bought their homes before the credit program kicked in.

Shouldn’t someone in the bureaucracy administering this program have been able to check the dates of the house purchases? Or is that too much of a skill to ask from unionized government employees?

The inspector general also identified 206 filers who claimed the credit for multiple addresses; these fraudulent filers were awarded a total of $1.4 million.

Again, isn’t this something that should have been noticed by the administrators before the money was doled out?

The report also found that improper filers included 34 employees of the IRS

Hilarious. But, alas, not much of a surprise.

This article was posted by Steve on Wednesday, June 23rd, 2010. Comments are currently closed.

10 Responses to “$30M Stolen Via Obama Homebuyer Credit”

  1. GetBackJack says:

    I fee much better now about the competency of the federal government strong-arming me into control of my health.

    • Mithrandir says:

      Yeah, there is NO CHANCE that health care will be doled out based on race, gender, sexual orientation.

      I CAN’T hear Jessie Jackson making claims that black patients are in need of 40% of the kidney transplants but only get 10% of them..

      NAW….health care won’t dive down into the sewer of Race / Gender / Sexual Orientation like regular politics. “The greatest good for the greatest number” is just an empty communist slogan that will never……oh who am I kidding?

  2. proreason says:

    “The report also found that improper filers included 34 employees of the IRS”

    Government – Chicago style.

  3. Georgfelis says:

    In all probability that would be 34 “former” employees of the IRS. The IRS has very little sense of humor when it comes to their employees conducting themselves in a fashion that even looks illegal to taxpayers.

    Also please be aware that just because the IG says these credits were handed out improperly, doesn’t mean it was *intentionally* in every single case. The department makes rules that sometimes defy logic, to the point where the legitimate applicant sometimes just jams in numbers into any blank on the form where they really dont know the answer and sends it in, hoping that whoever processes the form will correct it. And many times that bureaucrat entering the form into the computer doesn’t know either, and just plugs in the numbers. And many times the computer system which is supposed to catch these errors was programmed by somebody who also is a bit fuzzy on what was really supposed to go in block 14, line 12, and the error will slip by them too.

    On the flip side, I’ll bet just as many intentional frauds were missed as unintentional frauds caught, so the numbers probably even out.

    • proreason says:

      Perhaps, Georgfelis, your familiarity with the IRS was before 2009.

      There’s a new kid in town.

      I can see that your perspecitive is honorable, and based on what you know of the agency. Perhaps you are even an IRS employee or ex employee.

      But do you actually believe that the IRS has somehow remained separate from the sewer that moved into Washington in January 2008.

      If you believe that….you are hopelessly naive.

  4. Georgfelis says:

    Heh, no IRS agent here, but I have found their employees from bottom to (pre-Obama) top to be some of the coldest, no-nonsense, logical extractors of cash that exist in nature. Think Vulcans with calculators. Blood from a stone is their morning exercise. Geitner is viewed by nearly all of them with contempt, if any one of them had committed the same fraud on their tax return as he did, they would have found themselves sans employment in very short order. You can bet cold hard cash that each IRS employee who was on that list (excepting Geitner and close cronies) is getting the “drop ’em and spread” treatment from their equivalent of Internal Affairs.

    • proreason says:

      “the “drop ‘em and spread” treatment ”

      Maybe. Depends on their race.

      I continue to think its a new game with the Moron in charge.

      Don’t forget his famous comments about the Capital Gains tax, when a reporter pointed out that tax revenues are inversely proportional to the CG rate……”it’s not about tax revenue, it’s about fairness”.

      Obamy doesn’t care about how much tax revenue there is. He runs the printing presses when he needs money or puts the squeeze on a business. Tax revenue is a distant secondary issue to the overriding mission, which is to break capitalism and break white hegemony in the US.

  5. wterrier says:

    Awesome find Steve!

  6. Mithrandir says:

    As with government, you can count on at least 35% to go to FRAUD / WASTE / & ABUSE.

    Of course, don’t forget the money spent paying people to discover this fraud waste abuse AFTER THE FACT.

    It just seems clear that the government shouldn’t do ANYTHING to begin with, as nearly all the money is wasted or wasted on lawyers finding the fraud waste from the wasters.

  7. Rusty Shackleford says:

    Never underestimate the ability of the human species to game any system.


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