[Rushtalk] Federal Fraud...........
John A. Quayle
blueoval57 at verizon.net
Tue Jun 18 16:16:09 MDT 2013
IRS Immigration Fraud Scandal
By <http://spectator.org/people/jeffrey-lord>Jeffrey Lord on 6.18.13 @ 6:09AM
Rubio, Ryan losing credibility over amnesty as fraud issue returns.
And fraud to the tune of billions..
Now theres a combustible mix.
Lets start with the IRS, illegal immigration and
fraud. Well come back in a minute to Senator Rubio and Congressman Ryan.
For those who came in late, a year before the IRS
scandals burst onto the scene in early May of
2013, an alert investigative reporter for
WTHR-Indianapolis (Channel 13), Bob Segall by
name, produced a stunning piece of journalism.
Segalls video report is found
and we will quote from his story for the basics.
The tale begins when an Indiana tax preparer, who
requests anonymity, comes to Segall to alert the
investigative reporter to a major league tax
fraud. The bold print for emphasis is mine.
Were talking about a multi-billion dollar fraud
scheme here thats taking place and no one is
talking about it, he (the tax preparer) said.
The scheme involves illegal immigrants illegal
immigrants who are filing
How it works
The Internal Revenue Service says everyone who is
employed in the United States even those who
are working here illegally must report income
and pay taxes. Of course, undocumented workers
are not supposed to have a social security
number. So for them to pay taxes, the IRS created
whats called an ITIN, an individual
identification number. A 9-digit ITIN number
issued by the IRS provides both resident and
nonresident aliens with a unique identification
number that allows them to
While that may have seemed like a good idea, its now backfiring in a big way.
Each spring, at tax preparation offices all
across the nation, many illegal immigrants are
now eagerly filing tax returns to take advantage
of a tax loophole, using their ITIN numbers to get huge refunds from the IRS.
The loophole is called the Additional Child Tax
Credit. Its a fully-refundable credit of up to
$1000 per child, and its meant to help working
families who have children living at home.
But 13 Investigates has found many undocumented
workers are claiming the tax credit for kids who
live in Mexico lots of kids in Mexico.
Weve seen sometimes 10 or 12 dependents, most
times nieces and nephews, on these tax forms,
the whistleblower told Eyewitness News. The more
you put on there, the more you get back.
The whistleblower has thousands of examples, and
he brought some of them to 13 Investigates. While
identifying information such as names and
addresses on the tax returns was redacted, it was
still clear that the tax filers had received
large tax refunds after claiming additional child
tax credits for many dependents.
Heres a return right here: weve got a $10,300
refund for nine nieces and nephews, he said,
pointing to the words niece and nephew listed
on the tax forms nine separate times.
Were getting an $11,000 refund on this tax
return. Theres seven nieces and nephews, he
said, pointing to another set of documents. I
can bring out stacks and stacks. Its just so easy its ridiculous.
20 kids = $30,000
WTHR spoke to several undocumented workers who confirmed it is easy.
They all agreed to talk with WTHR investigative
reporter Bob Segall and a translator as long as
WTHR agreed not to reveal their identity.
One of the workers, who was interviewed at his
home in southern Indiana, admitted his address
was used this year to file tax returns by four
other undocumented workers who dont even live
there. Those four workers claimed 20 children
live inside the one residence and, as a result,
the IRS sent the illegal immigrants tax refunds totaling $29,608.
13 Investigates saw only one little girl who
lives at that address (a small mobile home). We
wondered about the 20 kids claimed as tax deductions?
They dont live here, said the undocumented
worker. The other kids are in their country of origin, which is Mexico.
He later explained none of the 20 children have
ever visited the United States let alone lived here.
So why should undocumented workers receive tax
credits for children living in a foreign country,
which is a violation of IRS tax rules?
If the opportunity is there and they can give it
to me, why not take advantage of it? the worker said.
Other undocumented workers in Indiana told 13
Investigates the same thing. Their families are
collecting tax refunds for children who do not
live in this country. Several of the workers told
WTHR they were told it was legal for them to
claim the tax credit for a child who does not live in the United States.
So what Segall uncovered is massive tax fraud by
illegal immigrants through the use of the Additional Child Tax Credit.
Segall then goes to a man who, barely a year
later, would become a familiar face to Americans.
The Inspector General of the Treasury Department,
Russell George. George, on camera, says this of
his repeated warnings to the IRS about this problem:
The magnitude of the problem has grown
exponentially, said Russell George, the United
States Department of Treasurys Inspector General
for Tax Administration (TIGTA).
And he says the IRS has known about the problem for years.
George has repeatedly warned the IRS that
additional child tax credits are being abused by
undocumented workers. In 2009, his office
released an audit report that showed ITIN tax
filers received about $1 billion in additional
child tax credits. Last year, the inspector
general released a new report showing the problem
now costs American taxpayers more than $4.2 billion.
Keep in mind, were talking $4 billion per
year, he said. Its very troubling.
What George finds even more troubling is the IRS
has not taken action despite multiple warnings from the inspector general.
Millions of people are seeking this tax credit
who, we believe, are not entitled to it, said
the inspector general. We have made
recommendations to [IRS] as to how they could
address this, and they have not taken sufficient
action in our view to solve the problem.
After noting that filings for the ACTC have
soared since 2001, the cost skyrocketing from
$161 million in 2001 to $4.2 billion say again,
billion in 2010, Segall goes to the IRS for comment.
What he gets is this:
The law has been clear for over a decade that
eligibility for these credits does not depend on
work authorization status or the type of taxpayer
identification number used. Any suggestion that
the IRS shouldnt be paying out these credits
under current law to ITIN holders is simply
incorrect. The IRS administers the law
impartially and applies it as it is written.
That was all. Repeated requests for on camera
interviews with IRS officials were denied. Period.
Inspector General George, however, took immediate
issue with that statement issued by the IRS. Reports Segall:
George disagrees with that position and believes
the IRS should be doing more to prevent
undocumented workers from getting billions in U.S. tax dollars.
The IRS is not doing something as simple as
requesting sufficient documentation from people
seeking this credit, he said. Once the money
goes out the door, its nearly impossible for the IRS to get it back.
End of story.
What does this one snapshot of massive tax fraud
captured so vividly by reporter Segall have to do
with Senator Rubio and Congressman Ryan?
Senator Rubio is in fact aware of the problem and
has introduced legislation to stop the fraud. For
this he has been attacked by Hispanic left-wing
activists as reported
in the Miami Herald in May of 2012. So too is
Congressman Ryan aware of the problem and, in
this May 2012 story from WTHR Bob Segall reports:
This is where our taxpayer money is going, to
the [additional] child tax credit, said Rep.
Paul Ryan (R-WI) Thursday morning during
Congressional debate. One investigation in
Indiana said illegal immigrants in Indiana are
getting $29,608 for 20 children they claimed for
the tax credit who live in Mexico and have never
visited the United States before!
Rep. Ryan, chairman of the House Budget
Committee, wants tax credits for illegal
immigrants stopped, and so do many other
lawmakers who saw WTHRs investigation. They
debated it Thursday morning on the floor of the
House after being bombarded by phone calls and
e-mails from constituents who watched the Eyewitness News report online.
Heres the problem and its potentially a very
big problem for Rubio and Ryan.
The two men, Rubio in the Senate as a member of
the so-called Gang of Eight, and Ryan in the
House, have aggressively gone out front on the issue of immigration.
Ryan has even declared that I will debate
anybody who tries to suggest that these ideas
that are moving through Congress are amnesty.
Theyre not. Amnesty is wiping the slate clean
and not paying any penalty for having done something wrong.
Over at National Review Mark Krikorian calls the
Florida Senators Gang of Eight bill Rubios
Amnesty in this
and says this of the Rubio Senate bill:
The result of all this is S.744, a sprawling,
844-page measure legalizes most of the illegal
population (plus many who were deported and are
currently living abroad), promises tougher
enforcement in the future, and hugely increases
all forms of legal immigration, low- and
high-skilled, temporary and permanent
Then we got to see the actual text of the
legislation. Rubios promised provisions are
absent. Regarding back taxes, for instance, the
bill requires only that applicants satisfy any
applicable federal tax liability that has
previously been assessed by the IRS. But a tax
is assessed only after a tax return has been
submitted or after the IRS has conducted an
audit. Since neither of those things happens with
illegal immigrants working off the books, there
arent any back taxes to be paid.
The fine for legalization is small just $500 up
front and $500 paid in installments, in return
for lifetime legal access to the U.S. labor
market. And while $500 can be a lot for an
illegal immigrant, in a certain sense it isnt a
fine, since the money would go into a slush fund
for DHS to dole out to groups such as La Raza,
which are in turn to provide services for the
very amnesty beneficiaries who paid the fines.
(Conservative writer John Fonte has called this
the Alinsky Fund.) Even such a modest penalty is
absent for crooked employers. They get amnesty
for free amnesty from prosecution for knowing
employment of illegal aliens, non-payment of
wages, non-payment of payroll taxes, and facilitation of identity theft.
As for learning English, the language requirement
applies only to already-amnestied immigrants
seeking the upgrade to full green card, and even
then, requires only enrollment in a class, not
demonstration of actual proficiency (which is
what is required for citizenship).
Moreover, the bill provides for a huge increase
in legal immigration and not just increased
numbers but increased complexity, in a system
already excessively complex. It has special
provisions for guest workers, farm laborers, and
foreign technology workers, doctors, and nurses,
as well as retirees, entrepreneurs, and foreign
students graduating with technical degrees. The
Schumer-Rubio bill simply seeks to placate every
interest group at the table by handing out more
visas. Numbers USA has estimated the number of
green cards that would be issued during the first
decade of the bills operation at 33 million.
About one-third of those would be illegal aliens
receiving amnesty, so new immigration would go
from about 1 million per year to 2 million.
Finally, securing the Mexican border. The
benchmark given in the bill is called effective
control and means surveillance of 100 percent of
the border and apprehension of 90 percent of
attempted infiltrators. This is absurdity many times over.
What does the reality of the Rubio bill, and the
aggressive defense of Ryan have to do with that
year-old investigative piece out of Indiana?
Everything. And while we like both Senator Rubio
and Congressman Ryan, their actions raise
troubling red flags both on the immigration bill
and their respective potential runs for president in 2016.
At the core of the Indiana story about tax fraud
by illegal immigrants is yet again the
realization that Big Government has gone off the
rails. It is so far from the original vision of
the Founders as expressed in the Constitution as to be hell-and-gone.
What the Indiana story of massive IRS fraud by
illegal immigrants vividly illustrates is yet
another story of corruption and government gone
wild. It is the same story as the IRS Tea Party
scandal. It is the same story as the NSA-Edward
Snowden issue. It is the same story as Benghazi.
It is the same story as State Department
cover-ups of tales of State Department employees
involvement with prostitutes, sexual assaults, and illegal drugs.
Time and time and time again this always comes
back to the incompetence and/or corruption of a
government that is seen as being run by arrogant
mandarins of the ruling class elite.
Knowing all of this, both Rubio and Ryan are out
there actively selling the idea that this time
government will get it right. That this time
their solutions to an out-of-control illegal
immigration problem which relies 100% on a Big
Government that has failed over and over and over
again and cant even manage to control the border
are going to work. Really. Honest.
In truth? This is nonsense on stilts.
Both men are in the process of developing the
immigration reform issue into a serious
credibility problem with their own conservative base.
Nor is the immigration issue helped when Senator
the whole point of the exercise is to get back
in the good graces of Hispanics. (Note: this is
the same Senator Graham who went after
Pennsylvania conservatives Pat Toomey in
particular for allegedly driving then-GOP
Senator Arlen Specter from the party. Grahams
candidate: liberal ex-Governor Tom Ridge. Suffice
to say, Toomey won. Grahams notion that a
conservative was a loser in Pennsylvania was flat dead wrong.)
When Congressman Ryan hotly declares that the
bipartisan immigration bill is not amnesty
and the bill is revealed to be more of the same
of the 1986 Reagan immigration bill which
Reagan himself considered to be amnesty his credibility plunges.
The other day in the Wall Street Journal, Karl
Rove tried to pass off a version of this same
idea and was instantly challenged in the WSJ by
former Reagan Attorney General Edwin Meese III.
Meese, bold print for emphasis mine:
Karl Roves recollection of the 1986 Immigration
Reform and Control Act (Immigration Reform and
the Hispanic Vote, op-ed, June 6) is, shall we
say, highly selective. That law, he writes,
essentially told those here illegally that if
they had arrived in the U.S. prior to 1982 and
wanted to become citizens, simply raise your
right hand. He asserts that the Gang of Eight
bill is different because it has plenty of
penalties and hurdles for those here illegally who seek citizenship.
Well, I was there in 86. I read that bill
carefully. (We did that back then.) And I can
tell you that Mr. Roves blithe description of the bill is way off the mark.
The 1986 act didnt turn illegal immigrants into
citizens on the spot. It granted temporary
resident status only to those who could prove
they had resided continuously in America for five
years. After 18 months, their status could be
upgraded to permanent residency, and only after
another five years could they become U.S. citizens.
But advancement to citizenship was not automatic.
Immigrants had to satisfy various requirements
along the way. They had to pay application fees,
learn to speak English, understand American
civics, pass a medical exam and register for
military selective service. Those with
convictions for a felony or three misdemeanors were ineligible.
Sound familiar? Its pretty much the same
penalties and hurdles set forth by the Gang of
Eight. Today they call it a roadmap to
citizenship. Ronald Reagan called it amnesty.
The 86 reform bill also had supposedly
rigorous border security and immigration law
enforcement provisions. So how did that pan out?
On the day Reagan signed comprehensive reform
into law, only one thing changed: Millions of
unlawful immigrants gained legal status. The
promised crackdowns on security and enforcement
never happened. Only amnesty prevailed.
Since the 86 amnesty, the number of illegal
immigrants has quadrupled. That should teach
Congress a very important lesson: Amnesty bends
the rule of law. And bending the rule of law to
reach a comprehensive deal winds up provoking
wholesale breaking of the law. Ultimately, it
encourages millions more to risk entering the
country illegally in the hope that one day they, too, might receive amnesty.
In other words, what Meese is saying here is that
what he sees ahead is a government that refuses
to learn from experience when dealing with
immigration and learning from experience is basic to conservatism.
Increasingly and dangerously Rubio and Ryan are
being seen as sons of the Republican
Establishment who, if they ever were elected
president, would spend their time in Bush-like
tinkerings at the margin of Big Government when
not expanding it outright. Their inability to
learn from the Reagan immigration experience is a
startling admission that perhaps neither man is
as conservative as once thought.
Are they good men? Yes. Talented and conservative
in many respects. But alas, what is on display
right this minute from both is the same old
Republican Establishment flirtation with Big Government.
Trust the government, say Rubio and Ryan. Really.
This time it will work. Honest.
After an endless series of stories about
incompetence or outright corruption in one
government scandal after another, not to mention
the massive failure of the 1986 Reagan
immigration law, there are conservatives aplenty
who listen to Marco Rubio and Paul Ryan and
simply dont believe a word they say on immigration.
About the Author
Jeffrey Lord is a former Reagan White House
political director and author. He writes from
Pennsylvania at <mailto:jlpa1 at aol.com>jlpa1 at aol.com.
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