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IRS Criminal Investigation Unit Identifies More Crimes Than in Previous Year

By:
S.J. Steinhardt
Published Date:
Dec 5, 2023

The IRS's Criminal Investigation unit (CI) identified $37.1 billion in tax and financial crimes in fiscal year 2023, exceeding the previous fiscal year, according to its 2023 Annual Report.

The CI initiated more than 2,676 criminal investigations, obtaining an 88.4 percent conviction rate, in the fiscal year ending Sept. 30, 2023, Accounting Today reported. In the previous year, the IRS-CI initiated more than 2,550 criminal investigations and identified more than $31 billion from tax and financial crimes. 

“IRS Criminal Investigation plays a vital role for tax administration and law enforcement, and the results from the past year dramatically illustrate the results," said IRS Commissioner Danny Werfel in a statement. "Criminal Investigation's work has identified tens of billions of dollars on issues including tax fraud, money laundering and cybercrimes. The work of Criminal Investigation employees – who often put themselves in harm's way to get the job done – continues to make a difference in helping uphold tax laws and protect taxpayers."

In the Annual Report’s “Message from the Chief,” CI Chief Jim Lee noted that the revenue collected by the IRS each year funds nearly 96 percent of the U.S. government.

Speaking to reporters at a press conference on Monday, Lee also acknowledged the threats of potential cuts to the IRS budget being debated in Congress 

"We are still dealing occasionally with the wildly inappropriate misinformation that's out there regarding IRS agents being armed, which is quite frankly inappropriate and incredibly dangerous," he said in remarks reported by Accounting Today. "But the reality is I cannot be more proud of the tenacity of the special agents, of the investigative and administrative analysts, communication specialists, really all personnel that operationally make CI tick. They carry out the mission every single day on behalf of the American public."

Lee also discussed COVID-19 and Employee Retention Credit (ERC)-related crimes.

"COVID fraud is still out there," he said."By the end of the fiscal year, we had more than 1,400 investigations that we initiated. We're nearing almost 700 indictments, and in just those COVID-related frauds, we have more than a 98 percent conviction rate."

The CI has a number of ERC investigations underway, he said, but only a few individuals have been charged and only four sentenced to date.

He also told the press conference that the CI has been hiring in recent years. "This the fourth year in a row that we saw a net increase in special agent hiring," he said. "That's a real change from eight to 10 years ago, where we were actually negative in attrition."

The CI is the only federal law enforcement agency that spends 100 percent of its time on financial investigations, the IRS stated.  Close to 70 percent of its time is focused on tax-related crimes, with the remaining financial crimes tied to activities such as narcotics trafficking, bank secrecy and money laundering, according to Accounting Today.

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